on those who are facing foreclosure by wells fargo and citi group might be able to breathe a little sigh of relief the two bain giants have halted most of their foreclosure sales and several states this is after the federal reserve and the office of the comptroller of the currency issue new guideline will this joint jam the housing inventory pipeline once again we're going to discuss this and more with michael richards and he's a contributor to the motley fool and tomorrow's the big day at j.p. morgan that will decide whether or not jamie diamond will be stripped of his chairmanship but some shareholders are crying foul and have called on the security and exchange commission to enter viene this is after a company called broadridge which is supposed to provide updates on shareholder votes suddenly stopped reporting this information on friday. and finally apple c.e.o. tim cook goes to washington tomorrow to testify over taxes did they pay too little are they gaming the system code will present his own plan to congress that will

have repercussions throughout the four fortune five hundred universe i'm going to be at the hearing and i'll bring back the whole report tomorrow but for today a get to what's in your prime interest. the first major bitcoin conference took place last weekend in san jose california prime interest producer bob inglis and i we were there and we had the chance to interact with a wide selection of in ten days from c.e.o.'s to techies and to just simply an enthusiast over the next few weeks we're going to. these interviews we have

interviews from the top execs at coyne labs trade hill. monetise run to gold dot com and open coin which is developing the somewhat controversial ripple currency in payment system now today we're going to feature the youngest one of the youngest c.e.o.'s at the conference he's one of the most successful that his name is charlie sram and he is the co-founder and c.e.o. a bit and say it was provides retail access to big coins as a registered money transfer agent he's twenty three years old and he wears a ring with his big coin on it they call forefinger charlie because if you top it off you can get always money the first question i asked charlie it was just to provide a little bit of background on what bit instant is and what it dies and here's his comments. that instead of the company and you want to buy a big coin locally so if you have a seven eleven a walmart c.v.s. to read your local location you can go into these places and actually buy

a big quantity up to two thousand dollars worth every day the same time if you have the corner you need for some reason to transfer back into dollars or any currency we can put money into your bank account within thirty minutes so we're servicing the under ten dollars dollar customer where most people who are buying big think that they need to go to these large exchanges and open up accounts and put trading orders and you don't need to do that when you go to europe and you buy euros you're either using your car going to one of the travelex or change places to do that and that's what that instant is poised to be and how widespread it's been sent in the u.s. we're in seven hundred thousand locations but globally we're in eleven different countries so you can buy because of any post office or bank in brazil and the airport or a bank in russia where we're in the caribbean islands where in ukraine where most of the eastern european countries and we are going to be in australia in the u.k. by the end of the month and you also just to have very exciting news that you're really seeing the capital funding you. everyone heard some money and it was at one

point five million cameron tyler great guys i met them in ibiza actually gave them my lounge chair and and that's how it all got started one of our first investors david a's are was there as well and he kind of pitched them on this whole thing where he's been in the money service business for over ten years so he's like a veteran of the banking world and he came and said wow this because thing is really going to overturn the whole financial infrastructure and he pitch them on it and introduce them to me they're like yeah here's i mean this charlie guy boy genius followed law and we all met and it was love at first sight we all got together and started building the company they actually invested. i would say like six months ago we just recently announced mit announced we want to make sure that everything was good and that we had all our ducks in a row at the time i was running the company out of my basement we had three employees it was a joke and they picked me up and they said charlie you have to make this thing now we're sixteen employees sixteen team members we're going to be eighteen people by the end of the month and moving to a new soho office as well in

a few weeks we have finally money transmitter licensing in over thirty states and federal licenses well within sign so we're really really pushed a lot and did really really good things and he also spoke about the rightness or environment that you're entering now you have to be why since in every state in order to do business and then can you just talk about the challenges that you're facing you know there are three environment out of the picture the financial industry in the united states is probably the most regulated industry in the world it's crazy and subsidized and so it's there are only like twenty companies that actually have licensing in all fifty states and you receive no federal support how and you know if they will know what they're throwing me under the bus they don't like us here the little guy and i'm a little guy and i'm super young so it's like who is this kid exactly so you know you come out and you say like we want this big thing to overturn everything but at the same time we have to be compliant and we have to know you have to know your customer you have to know every single customer no matter what even if they're transferred to die. or thousand dollars how reasonable is that it's not that

difficult to do the right way because money laundering in the outset treats you like a criminal and that's not fair the term money laundering was invented by banks and knowing your customers shouldn't be this complicated expensive thing and you shouldn't treat everyone like a criminal the beginning if you come to a customer and say hey look if you trust us we'll trust you you don't want to give us your social security number fine we can't let you transfer more than five hundred dollars if you want to check a certain amount of databases that's ok too and that's what we're trying to do we're trying to change that whole and overturn it from treating it like a criminal to scratch my back i scratch yours you don't actually meet your customers that this is all done over the internet yet you go to our web site you can actually hold up your id to the webcam and will scan it and we'll check all the databases and we can verify it within a few seconds when you go to one of our locations you can just show i.d. to the check to the cashier to the teller so it's still extremely private but it's not anonymous you get in your big car and you have this privacy that instant is retaining information we're not sharing with anyone but the same time we have you

know legal and regulatory obligations that we have to meet or not excessive or not over overstepping our boundaries here and that's really really important because people want their privacy when you go when you go and you vice piece of gum at seven eleven you're using cash because it's private you know not everyone's going to see the transaction but when you use your credit card every single person and their mother saw you pay on your credit card interest you every government agency anyone it's so easy to get a warrant for anyone to see your credit card statement and that's why people use cash so what is big on the coin is cash with wings it's the ability to be able to take a local transaction and do it globally and that's why the coin is going to overturn the financial infrastructure it's not only i would say a global monetary revolution but it's an evolution it's the evolution of money it's the next step it's the next the coin is like the largest social economic experiment the world has ever seen you're talking about millions of people around the world who are saying that this data is that worth of value to. yes and it has not only

just like like fuse and all these different types of amazon coins are not just companies that say this is worth valuable this is something that has an underlying financial global payment infrastructure that is what gives it its value like why is gold valuable gold is valuable because it has intrinsic value have. you going to look at it and anybody trading big points for gold or silver of course you have companies like cornball dot com and you can go gold to big corn because into gold there are a lot of different companies that do that and you can bypass dollars totally and you're saving a lot of money and wire transfer costs and if you have the coins you buy gold or silver with it it is actually saves you about five percent if you use dollars or your credit card or send a wire transfer because there's no market they can cut out every middleman when you use a credit card transaction there are four middlemen involved in that you have the issuing bank the merchant bank the payment gateway in the payment processor all need to take a cut this is a big reason why you opened up its bar ever in new york. you cut out

a lot of these transactions i mean you have a guy called the spend ten thousand dollars and he says credit card not only paying five percent fee on that but he has ninety days to come back and say oh i was drunk i didn't actually do this and even if we have month camera and even if we have everything american express will freeze that money for forty five days so for a small bar like us forty five days is for ten thousand dollars to get locked up is huge and even if we get that money back that's a huge cashflow issue for us with because we accept the because the money is in our bank account the next day can you talk a little bit more about ever is very unique very cool you know entrepreneur venture that you have going on in new york and how successful has it been so far where is it going so my two good friends from high school actually opened up the bar back in january and i was i was going there a lot hanging out and they said charlie we really really want it's a big going you know we see what you're doing it's really a fun cool thing we want to be like an innovative bar and i said yeah i haven't i'm too busy with that insane the foundation this conference to really get involved in it and they finally pushed me to do it and we did. and it was

a biggest explosion we've ever had and then they said charlie we want you involved you know take some equity and we want you more involved in the bar and that's how all that happens and it's great because you have a lot of big hundreds come all the time they feel a lot more a lot of the corners are including myself were a little socially awkward and when you go to a place like ever you feel more at home we have the table in the back everyone comes hangs out or friends with each other and it's a good place to hang out with the demographic ever it were more of an upscale place so you know if you're wearing sneakers or a t. shirt we want you and your snappy one of us a look good and be happy we're wearing jeans or maybe out you know whatever this is our jeans. all right well you're also the vice chairman of the big coin foundation can you talk a little bit more about your initiatives and what's on the table what the most important issues are pressuring right now in the family if you're into reasons why i'm at gavin and in austria actually both in austria the same time two years ago i said gavin we need a system or a way to take all these startups and pool our resources together pull our money

together create a big marketing budgets to a conference we need innovation we need to have to sit in a room together and all work together even though some of us are competitors and he said well there's this idea to start a big foundation and some people have been talking about it but no one has made the chump and you have guys like our vice chair our chairman peter sent us and and he came into the fold and five of us got in a room in seattle for two days straight away being doubt the byelaws and the foundation was born and the first order of business was to do this conference and that was what we focused on and look how amazing it is. and that was my interview with charlie shrem the co-founder and c.e.o. of bit instant l.l.c. i've next we're going to discuss housing prime interest producer justin and i will look at a few housing charts and discuss affordability i will also speak with michael richards and from the motley fool to weigh in on the retail market or the rental market and that's a rapidly shrinking i.p.o. in the daily dual bob inglis and i will discuss some more of what we saw this

weekend at the big. states and. dangerous experiments on prisoners they want to make money and they have healthy guinea pigs in the regular society they're not able to use prisoners i mean they wish they could. drug tests on human guinea pigs. to paul deadly pills. now so wait he was killed. he didn't pass away they let him get. his pharmacy really about helping people.

some of these traditional chili lines they've been bred and developed and passed down from generation to. this is a total destruction of the culture of new mexico by telling them i mean this this is not going to impact us not only new mexico whatever happens here it's about the whole world now we're. in the in the open in the you know all the organs or. genetically engineered crops why do you think this country is full of obese and sick people because we have a crappy food system. please speak your language. programs and documentaries in arabic it's all here on. reporting from the world's hot spots seventy ip interviews intriguing story for you. slim try. to

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among economic indicators housing statistics have attracted a lot of attention recently some are proclaiming that the housing recovery is lifting lifting other sectors out of the economy and some are wondering if now is a good time to buy a house so nods for more on how to interpret these numbers i turn to prime interest producer just seen underhill just in can you tell us a little bit more about the trends that you're seeing in the housing sector well this is a graph of the case shiller home price index and this is used to track changes in home prices throughout the u.s. and we have it from two thousand to today now over the past twelve months we've

seen a pretty steady rise in the home prices but and this is what everyone's been touting as our housing recovery and granted this is the biggest gains that we've seen in the index since may of two thousand and six and that's just comparing the slopes but if you look a little bit closer you can see that where we are now is fairly similar to where we were in two thousand and ten but certainly can't be interpreted as a housing recovery and part of the reason for the price depression that we saw right after two thousand and ten in two thousand and eleven was because of a wave of foreclosures that hit the market at that time and according to realty trac there's another wave of foreclosures in the pipeline that could depressed housing prices again now part of what's been driving this increase that we've seen in the past year in housing prices are the exceptionally low interest rates on mortgages and this is. thanks in part to the federal reserve's quantitative easing program where they're buying forty billion dollars of mortgage backed securities each month that's not trivial and these exceptionally low rates have made buying

a house more attractive and affordable and we can see this reflected in the next graph which shows pay mortgage payments as a share of household income and this is using median values for both the higher the line the less affordable. the mortgage is now today someone earning about fifty thousand dollars that's a median income a homeowner earning that would be spending using this line about twelve percent of their income on mortgage payments that's lower than for been in the past thirty years and you can see that even in the late seventy's early eighty's people were spending thirty five percent of their income on their mortgage and this was due to high interest rates before you go out to go buy a home to really understand affordability you have to look at the mortgage how much housing prices were. right now and we can see that reflected in this green line right here and this is a proportion of income so from the late late seventy's to late ninety's

i don't see that housing prices as a share of income were two point six times and you would come and there's a parabolic rise in the late in the late ninety's reaching four times that means that housing prices were four times what a family would make in a year and the crash brought that level down to about three times the amount but housing prices would have to drop another fifteen percent to see the same levels of affordability that we saw in the one nine hundred ninety s. why do you think housing prices have gone back to those pretty well one of the reasons is because of the unemployment situation with unemployment so high incomes have been stagnant and without an increase in wages we're not going to see affordability coming down until a lot of the correction is going to have to come from housing prices dropping further great things are weighing in on this just saying. and for more on the affordability of housing people are turning to rental properties and we're seeing a number of recent trends rental prices of single family housing has recently

declined or main fly in several key markets including california arizona nevada and florida currently we're seeing signs that some of the more aggressive and situational buyers of homes are looking for the exit door now i spoke earlier with mike richardson who's a contributor to the my motley fool and i asked him to comment on the investment funds that are snapping up house as they're forming rental companies to manage them and then spending them off into i.p.o. and i asked him if this is a sign of an underlying weakness. thank goodness with the financial engineering labs on wall street or back to business you know. the sarcasm but it's you know it's really had hoped that this phenomenon of let's figure out a way to make a quick buck on the investor past because you know these these rules they're talking about reminds me a lot of what we saw with the collateral as mortgage applications five or six years ago where you know they they looked at you know a variety of deduce from its mortgages slice from kabul and back together and then

put them to people as investments we all know how that story played out five years ago so i don't hoping that this is just a fad that passes but you know if they're looking at those you know which obviously what time will tell if these are going to successful or not but these different set i mean talk about the similarities or the differences that we're seeing the signs of being you know owning it first renting i really don't know because it's all you know cobbled together pieces of property. where you know with the. one mortgage just a one hundred thousand dollars twenty thousand went to there's traunch thirty thousand of those traunch it kind of seems to me that these are going to take the same three we're a portion of the room when com is going to those troche and a porsche is going to know the place so you know investor be aware if you decide to put your money into this you know you've got a lot of your risk involved if you know what happens if this property gets sold out from under you or if the sponsor goes bankrupt. and it just it really looks like it could play out the same way that we saw in a way and he also pointed out that they're doing this so fast that they haven't even had a chance to collect he said to states and he indicated such as turnover they can

see where a costs are making them ready so i think all this plays into that exactly exactly you know it's it's really rich areas where people are jumping the gun and before the really know what it's all about. that breeds a phenomenon of discontent for the investor that all the middle east failure and i think that what we saw today is wells fargo and citibank are halting their foreclosure process so it looks like we have a lot of inventory still in the pipeline do you think this is going to set the stage for a new wave of liquidation like we saw in two thousand and you know that's a good question. one of the things that people have looked at in the marketplace is how healthy is the housing recovery is this this very concerned right is you know there's a little glut of investment approaching a lot of markets in the midwest. just hasn't slowed up and where some of these. groups could come in and some of that up but then carve it out in the future as an

investment you know there's still a. wild range in various markets where there's not enough demand and that's maintained the slow growth in housing and you thought that i think it could be critical for us to look at you know these pieces as it relates to an overall recovery and rental markets are primarily a local driven market but having such low interest rates is now such a huge factor do you think the states for the rental market to be coming in and national markets closer local is possible you know it it boils down to the individual you know some people like the fact of homeownership at these rates where you're getting a thirty year note for under four percent and you know it's basically free money if you can do it take it you know where you can get eight hundred. hundred dollars on a mortgage conforming note if you will and then also you can look at and get the same same rate. for a comparable property you know

a lot of people opt for that homeownership just to say you know this is mine you know we can do it with it but we want other people say hey you know what i'll do we will deal with the property tax or the fixing up of what what breaks and might not want this in five or six years we're going to look for something else so i don't feel tied down isn't going to become more of a national phenomenon i just don't know that's as could be something that we have only time will tell and can you comment on also how the thirty year fixed rate mortgage seems to be the standard because that's what fannie and freddie require. why is it even realistic because people don't only hold on to write it and it is so rare that you will see anybody hold on to a thirty year note to it matures that's really what banks don't want to take an interest rate risk by holding a thirty year note on their books so the vehicle that's available is a sell that off to fannie mae or freddie mac. thus they inherit all the risk banks are more more apt to look at something of a lesser amortization under fifteen years old as

a portfolio loan it's much more you'll see those more for folks who have more to put down as a down payment someone's come to the table with forty percent that they can put down. and are looking to buy a jumbo mortgage something over that six fifty seven hundred thousand dollars mark in a bank will look at that and those are normally done with. lesser risk deals that are worked out so you know for for the average homeowner they look for something that's going to impact their cash flow each month you know they're looking at ok how much house can we afford and it not really afford ability and not take up all of our available cash so a thirty year note gives him that opportunity right so we're saying a lot of new trends here and now saying thanks so much for talking to us about this this is mike richards and i can tell you all that's happened.

jamie now it's. great to be here again starting off the week the bitcoin week as we might call it and this weekend we attended. five times the first ever met coin conference and guys can we hold it in d.c. or new york next year just asking a little far although i was a little disappointed that i couldn't bring any big coins back with me i did manage to get a coin at. which is a sold in big coins and i definitely wasn't expecting to see that but another thing i wasn't expecting to see was a couple of appearances we were right next door to a comic book convention and we're going to play a clip of an interview here with andreas out to no police and guys if we could roll that just look at the background here. but there is a cost there and when you go head into regulations that with this one for big companies you look just knowing what the regulations and yeah that was quite a matter of minutes or so i don't know if you saw so we're going to the viewers as

we're watching and rolling these interviews throughout the next couple of weeks keep your eye on the background might even see a ghostbuster to it was interesting weekend but you know just a few days before the conference homeland security seized a bank account from the gods which is one of the biggest big coin exchanges and there was definitely a cloud hanging over the conference the entire weekend that had everyone you know just reminding them of the government is has now interested in big coins and you know and they're not operating in compliance with the rules of the regulations then your operation is going to be in jeopardy i don't know if you would call it a cloud per se but everybody was hyper aware that they have to be in compliance with the rules and that was definitely one of the themes everybody wants to be in compliance with the rules because bitcoin is on the way up and everybody wants it to be perceived as legitimate which we believe it is well but keep in mind mt gox was allowed to have wives who authorities say that they. i would not be involved in money transfers when in fact it looks like they were well here's a problem with that i mean they they didn't check off a box that maybe they should of but these start ups you know cost

a lot of money it costs a million or two million dollars to register as a money transfer agent and it takes up to a year and a half a year or two a year and a half and some of these guys just don't have the time and money to do this but there are a lot of big point exchanges that are operating in compliance that want to be and complains about the government and they were there and they made it very clear that they want to do things right they want to have a legitimate business so investors you well have an incentive to get involved yes exactly and i think that's what we're going to see and we're going to be talking about this again throughout the week so we'll have more on this on the upcoming does. great things bob thank you. it's been quite a whirlwind day on prime interest after catching the right guy from san jose last night i'll keep my goodbye shorts from foreclosure halts to shareholder shenanigans

to housing market cracks to big claims i hope you enjoyed it all thanks for tuning and i'll have more big coin interviews later this week be sure to send us your comments and follow us on facebook dot com slash my mentors and from all of us at prime interest i'm harry and boring and i have a great night. dangerous experiments on prisoners they want to make money and they have healthy guinea pigs

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