good afternoon and welcome to prime interest i'm perry and boring here and washington d.c. and here's the story that i'm tracking today. remember john paul's know it not hank paulson bush's treasury secretary who pushed hard i'm talking about john paulson who shorted subprime and made of millions or as a hedge fund now he's long fannie and freddie along with some other hedge funds who bought preferred shares to match uncle sam's investment senator bob corker characterized the stock as a lottery ticket but that hasn't stopped a run up in price of over one hundred seventy percent in the last few months just last week at fannie mae and now say it will repay the treasury fifty nine billion dollars for bailout money it took during the crisis but this is a one off event that's only possible because of an entire change and deferred tax asset good luck mr paulson. and the bloomberg a standalone ten ten years as financial heavyweights engage in dialogue with the

embroiled market data provider clients including of china's central bank the federal reserve and the f.d.a. if you have inquired about data confidentiality issues in j.p. morgan short of problems itself is having serious dialogues with bloomberg and is considering its options the sheep executive of bloomberg lp has personally reached out to three hundred clients and apologized and lastly age as europe's a large as banged house so far gotten off with the risk for money laundering suits and the u.s. and europe but it now faces a new money during charges and argentina is a country that hordes one in fifteen u.s. bills according to bloomberg h.s.b.c. is trouble don't in there they recently reported they will eliminate as many as fourteen thousand more jobs as they seek to cut an additional three billion dollars of cost now we remember the last time i made. a bang got caught neck deep and

a money laundering scandal it was what code to the tune of three hundred billion dollars and only months later it would be established by wells fargo and the financial thing just and here's was in your prime and. i. believe that would reform our country's immigration laws the bill paves the path to citizenship for nearly an odd million immigrants the bill includes a four point five billion dollars plan to gain effective control of the mexican border states implementation of the event if i system increases the highly skilled worker visa and implements a new w. visa for low skilled workers but how economically feasible and reasonable is this bill and as a film of loopholes for the special interest groups well today i have with me well

mcbride the chief economist of the tax foundation and my coleman washington bureau chief of the albuquerque journal new mexico's largest newspaper thanks for joining i thank you it's really so. the gang of eight has supposedly introduced a bipartisan bill. mike can you please tell us who are the biggest opponents per poena and is this truly a bipartisan proposal it truly is a by part of some proposal the gang of eight is comprised of four republicans four democrats some other republicans including senator john mccain senator marco rubio from florida on the democratic side you've got the majority whip dick durbin. you've got senator menendez from from new jersey and while that effort is bipartisan there is certainly a large contingent relatively large contingent of conservatives more hardcore conservatives who oppose it for what they call amnesty or the so-called path to

citizenship for some eleven million illegal people who are already living here in the united states so it's bipartisan but it faces a long hot summer ahead i think on the hill and it's going to play well one of the tradeoffs with amnesty is. a tax provision that would require immigrants to pay back taxes to gain legal status now while you were quoted in the wall street journal on may tenth about this provision in an article titled taxing problems and immigration plan and you said if this does come to pass it's unlikely the i.r.s. will have a lot of resources to devote to this and that it's unworkable is likely not to have any real ability to do that can you please elaborate on this tax provision and the comments you made in the journal. well the iris is already under tremendous pressure. to particularly care for many of the provisions going effect this year we've turned our tax agency into

a health care you can see now. as well as many other things they're doing for years they've been doing various welfare programs particularly the earned income tax credit. so what there is just give you an idea of how stretched they are they're able to. and for all you folks out there who wonder who's going to get audited is to. two million populations it's the very wealthy and it's those taking that earned income tax credit that's because there's about a twenty five percent fraud rate in the earned income tax credit and with the wealthy that's where the money is so they have to pick and choose their battles basically and they're they're spread very thin so they're just they simply won't be going after illegal immigrants and they're back taxes on what are likely very low wages well now there is also a very controversial study by the heritage foundation that was put out it was titled the fiscal impact of unlawful immigrants and amnesty to the u.s.

taxpayer and what came of this was that they mean the illegal immigrants and they receive amnesty they would generate a lifetime fiscal deficit of six point three trillion dollars over their lifetime can they can we talk about the difference between dynamic scoring and static scoring and did this study even take into account you know factors considering that once one becomes illegal they start going to school all get better jobs they're going to pay taxes you can you address this yes and the answer is no they didn't take that stuff into account so it's not it's not really dynamic in that sense it's it is. it has a lot of interesting facts and figures in there but their basic approach is very static does not look at what happens to the next generation what does happen with immigrants typically is the second or third generation is basically indistinguishable from the native population and all sorts of measures including education in so what they've done is they've taken the current. a

assume that the current the first generation of immigrants remains in the in the same education status which is very low low education. outcomes for the most part and low income that goes along with that and so that's that's not very accurate ok. we can't really talk about this immigration debate without mentioning the heritage foundation study because it's been in the name is it was very controversial but also the cvo is supposedly going to score this bill do either of you have any numbers what you think it will look like i don't know that they're supposed to use dynamic scoring so i'm sure that the. negative economic impact would it wouldn't be as great as the heritage report but that's still to come nobody really knows what that study is going to say one. on that same note the cato institute which is a right leaning think tank here in town also did a similar study and they did use dynamic scoring and they found that the reform

bill would add one point five trillion to the economy and that by forcing the eleven million undocumented workers out of the country that there would actually be a two point six trillion dollar loss over ten years to the g.d.p. adding it adding people to citizenship or painting paving the pathway to citizenship for eleven million people that doesn't increase prosperity it doesn't increase production i mean we have a jobs problem here it's not that we don't have enough people working is that we don't have enough exports we don't have enough products being made is that just simply making somebody legal status is that going to increase our economic output. well what it will do is you're right they're already here there are already working and the question is how do we get them on the books basically how do we get them to pay taxes what it will do is boost tax revenue these people come out of the woodwork to. obtain proper paperwork i.d.'s. like we

tax revenue will go away as a result so it is it isn't going to change production or demand that much you're right going forward it may attract more immigrants but economists agree on a few things one is that more immigration is on balance very good for the economy to mess. economy of course it's very good for the workers they're coming in they're doing it they're risking their lives to get here so we know it's good for them. but it's also good for the domestic economy on balance and a lot of the costs in the bill are going to pay for increased border security and clearly new surveillance technology the border agents a new fan can anybody talk about if this is the economic or are there more cost effective ways to protect our border economical you mean cheap it's certainly not because we spent ten billion dollars in the last ten years ninety billion dollars in the last ten years on border enforcement mechanism it's been kind of

a mixed bag i mean it has. illegal crossings are down. but at the same time you know some of that may be attributed to be able to a better economy in mexico less opportunity here in the united states because our own economy has been suffering it has worked is very expensive but you know some of the things that my congress people in new mexico tell me is the least expensive just doing vehicle barriers and things and being very strategic about where you place these types of barriers so there are things you can do to be very expensive and the jury's i think still out on how effective it actually is well there's also brings into question the amount of money that we spend on detention facilities. either of you have any insight into private prisons and what they have to gain and lose in the immigration debate and are they will be in congress on this information . i don't i don't have any particular knowledge of that history except to say that there is a clearly a conflict of interest in that. to the extent that those are those are profit

profitable operations they they serve to their business is keeping people in jail right and so a lot of these folks are of the illegal immigrants so they would stand to lose and they might be lobbying against any sort of reform of the current system they have and they have a lot to lose and corrections corporations of america corporation of america why. the largest private prison operators in the country spent almost a million dollars last year campaign contributions to members of the gang of eight and others who have jurisdiction over this type of. what they call the deportation detention facilities which would you know we're keeping people before we deport them and so i think that they've got a big dog in the fight and they'll be very active as this thing moves forward ok and just last question i want to talk about the highly skilled workers what impact will this have on the economy that's a big part of this bill is the increase in h one b. visas right now we give about sixty five thousand

a year high tech companies mark zuckerberg. apple computer and everything they're saying you know we don't producing unfortunately enough highly skilled workers to fill some of these jobs at the need to fill so they're looking to india and pakistan and the thing is we bring a lot of these kids over here and we give them the best education that they could possibly get but you know we send them away so a lot of members in congress would like to increase that number up to over three hundred thousand a year and the number in this bill was one hundred ten thousand ok that would have to check my math on that i was thinking but in any case the idea being that some of these highly skilled highly educated people would be creating jobs and entrepreneurship and things like that that's all we have time for. well this is. the chief economist at the tax foundation and michael coleman washington at the albuquerque journal next we have an exclusive interview with the publisher of the trans then prime interest producer bob inglis and i will talk about.

hunger strike just pushed to the limit. the one hundred guantanamo deep. the means are screaming for justice. where is the end for good. is if. you.

speak your language does anybody will or not a day in. the program see documentaries in spanish matters to you. a little too much of an angle of the story. here. and try to alter the spanish find out more visit. or times in your jail cell one day founder of the trends and research institute publishes the trends journal the most recent journal featured

a wide range of topics including the arab spring a sniper's bail as well as the influence of the goldman getting earlier i spoke to gerald's one day about his views on global currency wars and i asked for his take on partisan u.s. politics. you look at most people they either call themselves republicans or democrats left right center whatever they're locked into a belief system and in that belief system they keep repeating the same shallow message the same silly talking points and they live in by and die by those you cannot give them facts to change their minds facts do not count in a belief system and that's what we have going on right now look at the media they call themselves by their own by their own definitions they'll say that they'll call themselves centrist ills bill they'll call the left wingers whatever they're locked in a belief system and that's the only thing that they listen to are their beliefs as

a political atheist where do you put allegiance to the flag. no i certainly don't pledge allegiance to a flag and i certainly do not believe in my president right or wrong i pledge allegiance to the constitution and the declaration of independence the pledge allegiance to the flag is a new thing they made up in the nineteenth fifties and what do i pledge to anymore they've abrogated the constitution they've destroyed the declaration of independence they've abrogated our of fifth sixth and fourth amendment rights so what do you know everything i love these politicians by the way we talk about our founding fathers the founding fathers would be real rolling in their graves how about not becoming involved in foreign entanglements well why don't we all know i

don't know why we move on to egypt's ok i want to move on to to more banking issues and i was a year you know i wanted you to speak on the importance of deposit or confidence within our banking system and why is that essential to keep banks solved and can you just talk about you know confidence in this psychological effects that go into our banking stocks or what people believe in it because of course they have f.d.i.c in their coverage watch for two hundred fifty thousand dollars in their account and what we saw in cyprus by the way recently to me that was the canary in the mines shift this is what happens when banks go bust will it happen in the united states i don't believe so they'll call a bank holiday they've done it before if there's a crisis remember they closed wall street for a week. and if you had certificates of deposit by the way you couldn't get

a mount you couldn't cast your men because those the financial instruments traded on wall street so you c.d.'s were locked up and when so what i believe what will happen if there's a banking crisis and there's no reason to believe there won't be one because everything they're doing is not solving this problem all they're doing is to basing the currencies by printing more money i believe they'll do what they did back in one nine hundred thirty three but just different and that is they devalue the currency and people don't realize that in thirty three you were forced by the federal emergency banking act to turn in all your goal and gold in those days the dollar was pegged to gold i'd list sell it to the government debt and if you didn't you went to jail or fine they had laws in place after all the gold was in day repay the price of gold to thirty five dollars an hour. which means that you just lost seventy percent of your purchasing power and i believe

that's what's going to happen where there are more bank holidays in europe bank holidays in the united states in argentina or anywhere they will devalue the currency you'll get your money don't worry about it it just won't be worth very much countries around the world are using and printing money you know in japan we haven't nomics you know you've read about you know the swiss they they've been printing francs and the of the e.c.b. as printing euro is all the keep up with the united states i mean you called this world and face and by can we is this would you consider this a currency war to. absolutely not only i consider a currency war lou since the brazilian finance minister monti he called it a foreign c. war currency war listen to alexander is now head of u.b.s. was former head of the bag he calls it a currency war mervyn king the outgoing head of the bank of england he calls it

a cards war even. called it a currency war and even add to the g. seven meeting they called it a currency war but then they said we can't call it a currency you war and we're not going to call it a currency war that's all this is and by the way since our base come into office the yen is lost fifteen percent of its value against the dollar and just a little bit of history because it's repeating itself this is the same thing that happened in the 1930's they're lowering the value of their currencies so they can export more of their problems and they did the japanese did this when they went off the gold standard in the 1930's they they lowered their currency so much that it fell sixty percent against the u.s. dollar in forty percent against the pound sterling so all this is about the lowering of the value of the currency is to export more products and i have this is

a minute left but i wanted to ask you about bernanke you've ags that strategy health and half of last week or last week and wrote and the journal kind of hinting about have winding down that five billion dollar a mine printing even that the fed is currently doing do you think that the fed actually has an exit strategy do you think interest rates are going to rise and what is going to be the result of. you know i don't know what they have but i know what they've done has it worked in interest rates have to go up at some point and when they do that most people who forecasting the bond market's going to crash with it and so too will the economy. because the only thing that's kept this a commie alive is the printing of cheap money and record low interest rates i just took out a loan to buy a historic building at a two point eight seven five percent mortgage at some of the heard of that's what's keeping the markets alive and even at those numbers those ridiculous lee low rates

we still have not seen a real recovery not when you look at income growth the kind of jobs that are being created or g.d.p. numbers. that was gerald solent a publisher of the trends journal and it has the full interview turn to our youtube channel at youtube dot com slash the prime interest. and joining me now is bob inglis prime interest producer yes it's great to be here again and we might have a duel today i'm sorry to say what we announced yesterday that we're going to attend the conference this weekend in san jose california so if anyone has anything

us to report on while we're there to submit your comments on you tube and facebook and we'll get you up but i do have some troubling news for fans of the government has seized cash assets from the largest bit coin exchange mt kopp god's homeland security claims to have probable cause because they were transmitting money without a life and now we have here a copy of the actual caesar warrants bob when there were in detail what did you find that was of interest to you know well unfortunately the achilles heel of big coins is that most people need to transfer money to it to be able to get them you have u.s. dollars you won't because you. to go to mt gox or one of the other providers and so this is like a bottleneck and what mt gox had done is open up a bank account at wells fargo and unfortunately they check some boxes know that they probably should have checked yes. we have this michael mcfarland special agent of homeland homeland security services who filed an affidavit and said that he

wants to investigate them and seize the money the point is part of this he interested only to find currency something that refers to any money that a government has declared to be legal tender and i mean does this strike you as a little bit funny definition of my money that's not what i reported as i think one of our first episodes i did a break down yesterday and it's just currency exactly nothing to do with legal usually in the old days currencies and this is their definition their government declares a currency to be legal tender despite the fact that it has no intrinsic value by reserves so i'm just wondering if you got this completely wrong if we could just throw this out to do that out the window and start fresh air well that's just the thing is we always have the government changing the definitions up i mean they change the definition of inflation as well used to be my. money supply and now it's a changing and i said prices. anyway. moving on.

interestingly enough just a few days ago there was a war and professors they made some really negative comments about bitcoins they said quote they're swimming in unchartered waters when it comes to its legal and regulatory situation and that the most obvious question is whether bitcoins are even legal professions of them and as we know c o t c commissioner children came out a few days ago he said he wants to regulate big koreans and the commissioner of the chairman actually gary gensler he went toward an interesting story about him somebody who was a friend of robert when we were going to meet at the conference this week and went to school with them. he said when he went to the recorders were going to him at goldman sachs goldman sachs only wanted to talk to gary gensler you know it's my little story about him not surprising is is all they're saying all this stuff comes together exactly that's all we have time for us ari back line fans.

now it's been a day of trends and reversals on prime interest we looked at subprime as number one the hedge fund shorter john paulson he's now flipped and is betting out on the bailed out jesse's will emerge from conservatorship the list of concerns clients is growing longer with china the fed and j.p. morgan joining the fray we talk with gerald solent today about the number of trends he's tracking from u.s. dollar troubles to global monetary policy that germans exit strategy and we talked about the cost of emigration with well mcbride and my coleman and finally we had to end on a sad note highlighting the continuing troubles with bitcoin servicers thanks for watching we'll be back tomorrow with more and be sure to catch our extended

interview with gerald solon day on you tube at you tube dot com slash prime interest and from everyone at prime interest and carry on boring a great day. the a. little. real damage and complexity of this oil spill was not something you grasp just by looking at dirty birds we have between four to five million people in this directly

affected area of the coast and it's pretty clear why it's not being reported because b.p. can't afford to have a reported all along the gulf coast are clean they are safe and they're open for business if b.p. is the single largest oil contributor to the pentagon the us war machine is heavily reliant upon b.p. and their oil this is a huge step backwards for the marker sea it's a step forward for oligarchy carex it is toxic is a look a lot like spraying in vietnam it was a it was not a picture that either the government or b.p. really wanted to have out there i don't want dispersants to be the agent on. this. modern russia was built on coal. fuel for its factories. coke for

its steel to mark gold as it all and heat for its people. join me james brown to meet them in to spend their lives underground and work in one of the world's most dangerous professions. free. goods. hearts of coal on naughty. dangerous experiments on. prisoners they want to make money and they have these healthy guinea pigs in the regular society they're not able to use prisoners i mean will they wish they could. drug tests on human guinea pigs. eight to call deadly pills he didn't passed away he was killed.

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