first to dive into its gold reserves a draft bailout document seen by the financial times said the cypriot thordis have committed to sell the excess amount of gold reserves owned by the republic the excess amount was ten tons of their thirteen point nine tons which was worth four hundred million euro right well on this show we have said that the i.m.f. the e.u. the e.c.b. the so-called troika there their goal as they maraud around europe is to grab the gold remember greece had to give up their gold to the troika cyprus of course will give up their gold and it's funny because obviously the cypriot government was the last to know that the i.m.f. had taken their gold then they said wait a minute no that never happened then they got the phone call saying wait but we did take your gold then they came out with it oh i think they did take our gold but of course that's what they want the gold price itself was down on the news that there's going to be a seller in the market meanwhile chinese gold buyers are frantically on the phone will take it will take it so it's

a great day for china yet will gold kline's one point six five percent then the news came out that they had tonight and then you saw a tweet from market watch gold rebounds a day after nearly two percent tumble and then the government of cyprus came out and said yes we have a draft member we just haven't told our central bank yet that where we just sell our gold oh as confucius said i.m.f. stupid so gold we buy. now the other interesting thing about this when this news emerged is that they said the reason why the gold market sold off is that people investors took this as a sign that this would be the template the cypriot template for the rest of europe that other eurozone nations and they mention italy in particular would have to give up their gold and italy we know has a lot of gold well that's right in the euro zone there are twelve thousand tons of gold america supposedly has a thousand tons of gold but as the confiscation of wealth begins in earnest and you

have the breakdown of currencies and the bubble in the bond market the bubble in the stock market reaches its apex then as we've been saying all roads lead back to some form of gold slash bitcoin global currency standard and the other thing that i've seen about when the cyprus selling their gold part of this is about the bailout documents with the troika and they also imagine that they're going to earn six hundred million euros from increasing the corporate tax rate how are you going to increase the corporate tax rate what corporation is going to remain in that country this is over the next three years they see right well when you have people who live in the world of academia put out white paper suggesting that they can raise taxes on corporations in a country that's now bankrupt and somehow raise enough money to pay off the debts that's what happens you need actual people on the ground who are doing business not academics who are cranking out white papers who have never had a real job in life ben bernanke has never had an actual job in his life paul krugman is not actually ever had an actual job in his life they're just put out

insane documents and if it doesn't work out they'll do just blame some god of insanity well let's look at this you know you bring up these academics the old ladies staff gamers and gold bugs the old lady of course is the late old lady of threadneedle street and that's the bank of england and the bank of england employees spend their work time playing. online games planning trips to expensive shops and working out how to buy gold according to data obtained by the capitalist newspaper here and what they found is of the top five hundred sites one of the most frequented is the s.p.d. our gold shares company a company that promises an innovative relatively cost efficient and secure way to access the gold markets at the time of going to press they say max the capitalist could not confirm whether this pointed towards future monetary policy well a lot of people who work in slaughterhouses become vegetarians and people who work

at the bank of england who say what they do at the bank of england just trashing the pound trashing currency making extraordinarily lopsided bets in favor of an entrenched aristocracy they go on they start buying gold and you also brought up them frank he's in the news in the headlines this week by accident fed gives early data to banks the federal reserve alerted bank officials on tuesday that policymakers were considering a shift i went to begin easing back on stimulus efforts a day before the news was released publicly but it insisted there was no evidence traders on wall street had benefited from what it was called an error and the banks where citibank j.p. morgan goldman sachs wells fargo u.b.s. b.m.p. perry and h.s.b.c. well every month the federal reserve bank prints eighty five billion dollars in cash and that money is front run in other words people are buying stocks and bonds they know that this cash is coming and you have these rallies in stocks and bonds

based on the artificial stimulation of simply printing money on top of that gaming that system they are also issuing data head of the official release for insider trading as if it wasn't easy enough to make money simply front running all the money that the president that the fed is printing they want to sweeten the pot by actually giving them insider information that they can trade on and of course congress washington in. it's not illegal to trade on inside information is completely legal to take inside information call your broker and make money on that insert information it's something it's a law of carved out just for congress that they're allowed to do that so admit it makes a mockery and i think that when i hear monday when i see people protesting and out in the streets and singing the wicked witch is dead referring to margaret thatcher and the death of neo liberalism and the death of her policies that corrupted and destroyed this country i see that as the opening salvo of a greater social unrest and hopefully a revolution in this country anyway so but the fed is

a single point of failure as are these people who hold in the central data the central information that controls the perception of our global economy and this brings us to the final section here about bitcoin we're actually going to talk a lot about it in the next episode because we prerecorded an interview with tony gillespie a bit pay the day that the market crash at mt gox but for that i want to talk about the bigger picture of this and that is tech crunch unfazed by bitcoins wild swings and mysterious origins silicon valley v.c. place their bets it's far from certain that bitcoin is going to be a big deal said lightspeed venture partners jeremy lew has made two investments in the space but the potential for disruption is enormous if bitcoin realizes its full potential you're talking about disrupting visa first data master card a lot of banks western union these are huge multibillion dollar companies it's far from certain but if it happens a lot of value will be destroyed and

a lot of value will be created that's when venture capitalist should be looking right i mean bitcoin you have to compare two bit torrent bit torrent made piracy so called of intellectual property like news it in films a reality for millions totally transform that industry to the point now where the makers of game of thrones have said that we welcome the pirates pirating game of thrones it's our marketing. at a g. and we haven't stopped making money so they finally got the religion they got it so chris dodd to. stop killing kids like guarantors meanwhile on bit coin similarly mastercard wall street will have their come to bit christ moment and they'll say you know what this is not a bad thing it's a good thing but by then the price will be well over a thousand dollars per bitcoin i personally don't like to talk about the price i think you know people are obsessed with it out there people are obsessed with not the function of a house to live in you know bathe in there and take and keep warm they're obsessed

with the prices this is something that we see all over london but this is a master card of public are trying to companies with multi hundred billion dollars valuation that they used to lobby washing of the change laws in their favor therefore the price is important for big going to get the market cap up sufficiently so we can have our own lobbyist go to washington make our own laws so we can push these renegades and terrorists out of the way for a bit coin reality in a big going society that's why it's important to get the price up people by the price are involved in a live rush to live rush out there you should have big coal and in your portfolio so well let's talk about the bigger idea again back to what i like is the notion of a payment system as big investors emerge bitcoin gets ready for its close up now this is the winklevoss twins have invested they own one percent of bitcoin apparently and cameron winklevoss says people say it's a ponzi scheme it's a bubble people really don't want to take it seriously at some point that narrative

will shift to virtual currencies are here to stay or in the early days now max you have a patent on virtual currencies and this is what we're going to talk about the next episode because we have heard that the people who now own that patent are actually using that patent to create a better more efficient market making technology system on bitcoin well potentially cantor fitzgerald who owns my market making technology for virtual securities with virtual currency are rumored. to be getting into this space but that could be a negative because corporations and banks use patent law just for innovation and to kill industries so counterfeits general which is already been exposed as a bad actor we don't why actually want them in the space and i hope that we'll be able to defeat them and then finally on this chris dixon a partner anderson horowitz an investor in the tech space says why he's investing a big coin is that there are three areas of currency commodity based example gold politically based example dollar amount based example coins so he's investing as

a sort of regime change currency that we go from you know epochs you know big time periods of gold commodity based currencies for thousands of years for the last forty years we've been enough based system and he sees this as an emergence of mass backed currency and i like that term regime change and that's exactly what they call it is us bring in a regime change just like saddam hussein got hung so will the us dollar station ever thank so much for being on the cover of work thank you max all right stay tuned for the second half i'll be talking to james turk of gold money foundation. that's a meteorite oh. sorry

. kowtowed through space towards russia. with the. of a nuclear. free open sky full on our city. this lad. by conflict. has changed. a modern islamic nation. and a peaceful one has found islam is first secular last second. fashion. and still. in place of. traditions still. cannot go on the catwalk in

a swimsuit. republican country see. international and world in the very heart of moscow. all right welcome back to the kaiser report imax guys are time now to turn to james

turk of gold money dot com james welcome back to the kaiser report thanks max so it's great to be with you so much is happening james i a lot to cover i wanted to jump right in and i read a headline i thought immediately of you portugal will begin paying their public workers with treasury bills instead of cash this sounds like an alarm bell your thoughts it definitely is an alarm bell you know there's a saying from an american philosopher if you ignore history you end reliving it and what portugal is doing is what happened in america after the war of independence instead of actually paying bills they should little pieces of paper and those little pieces of paper circulated discourtesy they're called bills of credit because the result was so bad the currency at the time the continental which was the first currency in america hyperinflated they put it in the constitution that you can't issue bills of credit portugal is trying to issue bills for credit they call it you know treasury bills but it's essentially the same thing ok let's jump over to cyprus ok cyprus there they're taking money out of people's bank accounts

we saw out of the m.f. global united states all the more of the institutional side that kind of went over the people's heads they weren't paying much attention to and now the government just taking money out of people's bank accounts or thought yeah yeah it was a shocker for me in the sense that they were first. talking about going even after the insured deposits and then they backtracked from that very very quickly but i think there are a couple lessons that you know we can we can take from it i think the first is they just don't have the money to do a bailout you know i think the central bankers in the central planners of this world realize that the problems are just too big that they can't just create more bailouts because the money isn't there and i think the second thing we can take away from it is that there's a black hole on the balance sheet of the banks of the banking system the liabilities are much greater than the amount of assets and have to fill that black hole and they've been doing that with with bailouts but i think the point of cyprus is that there are a lot of other banks around the world that have this black hole on their balance

sheet and you know i've always been calling cyprus not a euro crisis it's a banking crisis and i think this banking crisis is going to spread to other countries and it's not only put a crisis it's an insolvent see crisis exactly and banks look like they're solvent because they're liquid until overnight the liquidity dries up for whatever reasons in the case of cyprus the e.c.b. so they're not going to lend more money and the insolvency became quite clear so you know that's the nature of bank failures they look good until they actually fail which is an overnight event where you look at the whole euro zone up until recently there has been this idea that they could create these master funding. platforms to roll the debt forward extend and pretend they came up with the various acronyms for various funds and of course all these funds are a backstop by the e.c.b. which is essentially the old deutsche bank the bank of germany essentially but in a cyprus situation like germany finally came out and said. you know no we don't we don't we're not going to draw the line there so it seems like the euro project

which was supposedly bringing harmony and they won the recent peace prize for the all the harmony of the euro project suddenly there's acrimony and germany seem to be playing it's a very traditional role the air of squaring off against everybody else is germany have a sense please close the credit spigots and they're just going to let these companies waste away well you know it's a good point maybe this was set up to enable germany to have an excuse to withdraw from the euro and create a northern euro with itself holland maybe slovakia finland and one or two other countries that's a possibility but i think you know what they're trying to do or what they tried to do with quantitative easing and all this money printing is hope that by putting this money into the economy that the economy would get jumpstarted in the problems would disappear but i think the recognizing now that all of the money printing in the world has not solved the unemployment problem got the economy moving and those problems are getting bigger and bigger as the economy continues to deteriorate and so i think they're really now in crunch time and they're starting to recognize the reality of the situation that these remedies that they've been trying haven't

worked i mean i know you're friends with another frequent guest on our show james records and he talks about the currency collapses around the world kind of going in a certain order based on vulnerabilities and i think clearly japan is in a precarious situation so if you could just talk a little bit about what's happening in japan and the and the policies and then is he correct and do you agree that the next currency could be the british pound but first dmn you know what's happening in japan is just unbelievable you know on a per capita basis they've been doing quite well compared to europe and even to the united states you know they say that the physician is bad but deflation really isn't bad because it basically means that your purchasing power of the money is worth more in the future than the distant a so you're actually increasing your purchasing power. in a deflationary environment the the new prime minister wants to change that and the central bank governors are following that policy and they literally opened up the

printing presses in the end which was seventy seven last year to the dollar it's now approaching one hundred to the dollar that shows you how badly the yen this weekend and everyone expecting a huge inflationary result and perhaps a hyperinflationary result in what we are seeing worldwide is a horse race between the currencies you know the the euro the dollar and the british pound it's a question of which one collapses first and right now the yen is leading and it could well be that the pound might be next but i'll tell you it's a close horse races to which one it will be you mentioned deflation and of course that brings me into the new kid on the block bitcoin which one of the criticisms of hair in some portions of the press is that is bad because if there's a fixed rate it's all going to be twenty one million therefore that's going to be deflationary at some point and that's bad but if you're an inherent to let's say the austrian school of economics where you're talking my gold as a currency or gold as money it's naturally has

a somewhat fixed rate of supply as well so i would imagine that bitcoin from an austrian perspective we're going to get a bit philosophical here it seems to play into the austrian mindset however within the austrian school there are people who are expressed very negative thoughts on bitcoin james turk the man tell us your opinion you put me into a big country for you to play the middle of this sorted out well you know the austrians have a prop some austrian school people have a problem with that because it doesn't tie neatly into the regression theorem which ok which is which is basically that money has to have some tangible substance some other use besides its use as a means of account and a kind of goes back to barter exactly he's a good back tomorrow and how money eventually evolved in gold and silver became the most liquid form of commodity and therefore they had a monetary. role rice i'd rather use there's a history and you're saying well is barter and then that a substitute for barter but has

a value and that value is worth the value of the barter and that's that but they don't like it because it doesn't express that yeah but in my mind what's more the most important contribution of the austrian school is that value is subjective every individual sees a particular object or even an intangible object and can view it differently than another person and i think that's really what the underlying value argument is for bitcoin that because value is subjective and everybody sees it differently some people might value that more highly than other people and a bit coin does have advantages and disadvantages just like everything else in this world nothing is perfect but it does have some unique advantages in the sense that it cannot be confiscated firstly you know in the twentieth century you know gold was confiscated by lenin weaselling the hitler and roosevelt you know why did they do that they tried to increase the power of the state by getting control of the money in the printing press because it prevents that so in that sense bitcoin is an important consideration and i think it is a step forward in terms of monetary development and we have to look at it seriously

we've actually been studying it for a few months to see more to get the idea is that it expects. yeah i don't get credit for the stuff and i make a rectifier there right now anyway but using this mining metaphor as it relates to gold people understand there's a limit about a gold you've got to go mine it and as you might it gets more expensive you know as in south africa is so far deep down in the mines that they're almost touching the lava it's very hot down there running out of gold they could peak gold right some of those mines have to be air conditioned because they're so hot because they're so deep that's expensive cosco whoever created bit quiet and nobody really knows who this chap is or whether it's actually a group of individuals they obviously understood gold and they understood you know mining and all of the but all of that's in gold mining in the some of the documents that we do have available from the creator and he mentioned gold mining they mention that they are completely unhappy with the current way banks are run. but the way that this algorithm works is you're digging into a mine if you will of primary numbers increasingly more difficult to extract with

the distributed network of computers so that in itself in a world that we live in digital and in the world of cryptology in a world of surveillance can't you say that there's a scarcity value that that has intrinsic value unto itself above and beyond the utility value they just described well i'm not a mathematician but then again i'm not a miner either but you know i understand that gold has value and i see that you know because it has value to people who understand mathematics so instead of mining it to geology or money into mathematics that i think you know the logic of it makes sense and also you know given the fact that there are advantages to bitcoin like it cannot be confiscated it's a very good currency in many many respects i think it does have some unique advantages that that need further can further study and i'm speaking of austrians i saw the lu rockwell site who is a noted libertarian and arco capitalist an austrian school fellow he had a speech up on his site and i actually like the piece because he was the writer was

saying that people should be prepared for an attack on that calling because it challenges the state the challenges the banks the banks can't continue their rent seeking ways in their currency ways their fractional banking ways and right are saying prepare yourself for this attack but my question is do you think that the fact because represents a threat to these guys you rub elbows with these guys james are they one of the what does it tell us what are they saying are they run are they getting a little concerned perhaps but what can you do about it you know it's been put out there and you say i was able to laugh ha ha ha ha not evil at all it's like i say it's you know but quinn has advantages and it is a reality you know maybe they're going to fight it as it gets bigger and this becomes more popular i hope they don't because i'm in favor of you know what individuals choose. what currencies they want to use some you know this is ron paul's point you know the freedom of choice in terms of currencies which goes back

to you know. in history nationalization of money national money compete against free market money and see whatever people want to use and let them be free to choose you know after all that's how we humans progress you know when we interact with one another we you know adam smith's invisible hand we both end up benefiting from it so let's go back to the basic classic economic principles and let every currency compete against one another well competition breeds growth versus central planning which kind of greed you know more stagnation i think that's a fair statement i've always said that i mean i can debate people on that point but i want to back to this idea we have about a minute or so left the big trend of the day is this confiscation now in cyprus they've just taken the money out of a bank accounts with m.f. global jamie diamond j.p. morgan they did it on the institutional level a specially stole a billion dollars jamie dimon just said look i'm a gangster he can't do anything about it now there is another form of confiscation though which we see in the u.s. and in the u.k.

it's called quantitative easing right am i wrong to say that talking about there you are just confiscation because you're taking wealth you're taking purchasing power away from individuals who hold those currencies you know if you put one hundred pounds or one hundred dollars in a bank account on january one at the end of the year you might have one hundred one dollars or one hundred one pounds but your purchasing power is only like ninety five or maybe even a little bit less involved in the company in france because in the u.k. . interest rates are forced down through quantitative easing right as a result the interest on things like mortgages are less so people end up paying seventy billion pounds less in interest income last year however people with money in the bank who would get interest on that on that on that money in savings lost two hundred twenty billion if you hounds you're destroying capital you're just lowering capital you're shifting money from people who worked hard and saved to speculators exactly when the government's enabling that you're shifting it to debt . now dead is not necessarily bad but the point is that has to be serviced by harder and capital you can't destroy the depositors because if you do that you're

destroying capitalism and it just completely wrecks our economy all right well we're out of time but i don't want to mention before we go that you also have gold money news as a channel on youtube and there's a lot of excellent interviews on there now i haven't i just checked in with him again after six months and you've got lots of great stuff you've got a team down in cyprus they've got man on the street interviews down there and it's really built up quite a resource so i would direct people to that is it going wild that it is going well that cyprus interview is very popular really shows what's happening you know how the bankers pounded cyprus back to the stone age literally but there's also one that you know you and i did a year or so ago called money inflation in fronts and i highly recommend you know tuning into that one is also because they asked again was the same thing as monetizing debt and the revolution quickly came after that exactly there's a lot of information from that that video that applies to today so i recommend taking a look at what is a classic video if it's last if it alright thanks for thanks so much for being on

the kaiser thank you max all right that's going to do it for this edition of the kaiser report with me max kaiser and stacey hurt my guest james turk of gold money dot com if you'd like to send us an e-mail please do so at kaiser report at r t t v dot are you don't like the nice guys are saying bye go. into no silence. does it. every day is a struggle. for our children sleep soundly at night. we are palestinian women in israel. we've done more for our kids than allah has it's. we are ten times in this life.

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