well go to the kaiser report imax kaiser spankings are trading better all time high according to the economist magazine bankers are paying top dollar or pounds in this case for a good old fashioned bottom slapping from a dominatrix who can show them who is the true bad boy meanwhile because of the debts of the austerity pushed by these same masochistic spanking loving banks are the economist magazine reports that the prostitution market in the u.k. has been flooded with new entrants driving prices ever lower may love you love so long time for these discount brokers of love in the alleyway stacey yes max

so banks there bashing is doing very well despite went david cameron tells a population not to bet bash the banks are so much but according to the economist sex doesn't sell an old industry is in deep recession times are tough for debbie a prostitute a western england who runs a private flat with other quote mature ladies she does two or three jobs a day a year ago she was doing eight or nine she has cut her prices if i hadn't i wouldn't still be open she says that she can now make more money doing up furniture and attendant car boot sales that she can turning tricks and i think this is fascinating because the government and people like vince cable and others are saying that we should stop the banker bashing it's unfair to the banks ters to publicly pillory them and yet these guys are going to dominate tricks to get beat up to get spanked to get punched in the face by a professional dominatrix so they clearly want to get beat up they clearly want to

be treated and degraded treated poorly integrated so. i think that the government in order to save a bundle should hire some dominate tricks on the payroll of her majesty's government their sole purpose should be to go down to the city every day and beat these banks bloody and save the taxpayers a lot of money they love it they're dying to be beaten up they're crying out for it the prices are skyrocketing why can't the government capture that spread why can't the government cash in on the banks there's need to be degraded and treated poorly by professional dominates works well also you can compare this problem for the prostitutes here in the u.k. with what's going on in the market because the fact is the economist points out that there's a flood of new entrants because of the bad economy because of declining wages but also because of all the debts pushed on the students there a lot of young people entering the market in order to pay their student debt and they're the economist points out that these new more naïve innocent entrance to the

market are putting themselves at huge risk for very little reward and you see that only everywhere in our common me people are taking huge risks for very little rewards at this point yeah i see your point there is that with interest rates being forced down to zero people are taking heed risks by going into stocks at all time highs by going to the bond market at all time highs meanwhile the government's manipulate the price of gold lower so that people shy away from gold but the point is that austerity measures imposed by george osborne george osborne is a pep because he brought in austerity measures that drove down the wages and jobs of this country to the point where now millions of young british teens a fanatic turn themselves into prostitutes to make ends meet so george osborne is the the biggest pimp in the history of britain well one other thing i'll say on

this before moving on to the next is that here we have a situation where this. or woman is saying that she can make more money now not turning tricks but actually working doing something for a living and maybe that's the one upside of a disastrous collapsed economy is that people might actually say oh instead of playing farmville all day or flipping houses i might actually have to get a job because i can make more money doing that right i was once a template for the real estate industry and for these young teens that are forced into prostitution because of a stereo budget you should get like a big purple furry had and maybe a pink cadillac and drive around westminster like that george osborne the mo full pimp on the mack daddy of the bank of england coming to my rad and i show you a good time on george osborne the pimp. well you know the mature lady right now on the global feed our currency system is the dollar and there is no love for the

dollar these days but there isn't during a love this deal like the segue to the next this dollar needed to prophylactics to keep it from spreading its deadly financial same and throughout the global economy impregnating various governments with uncontrolled and called for progeny of incipient inflationary crack babies. well frank holmes writes of the enduring love for physical gold the love trade for gold is still on so he looks at the breakdown of the global gold demand from the world gold council through march thirty first two thousand and thirteen and the main source of weakness was the fear trade as demand for gold e.t.f. and similar gold products plunged in the first quarter however the love of trade scooped up jewelry and bars and coins with the tonnage in each category growing twelve and ten percent respectively on a year over year basis it was in india where we saw gold demand grow by twenty

seven percent in the u.s. it actually grew by twenty two percent in china. it's up twenty percent he calls this the physical gold market is the love trade the e.t.f. is the fear trade now it's amazing that when the government's actively engaged along with j.p. morgan and others in manipulation of gold and so over it causes fear in the hearts of speculators and house flippers in the west but the feeling enjoyed by the east is love they love to see those low prices and india china and vietnam they go on they bought physical gold and love it and i say give due to the enemy's people johnnie's people japanese people gold loves you you love gold it's beautiful well in fact what he's saying is that people who are investing in the gold e.t.f. because they feared government policy they feared inflation they fear deflation they flared feared what was happening in the economy but now he's suggesting that westerners those in america holding gold g.l.d. the e.t.f.

no longer have fear and they feel that they believe the propaganda now they've capitulated they say ok we trust ben bernanke that he's going to rescue the economy well the us a again this is the classic syndrome that happens when it's called grooming ben bernanke is groomed the american population into believing that he loves them before he pimped them out like george osborne does they're in for a whole heap of trouble meanwhile people in asia are saying we don't want them ben bernanke you george osborne dad in nonsense we're just going to buy physical gold and you can take your paper nonsense dollars and pounds and it can disappear well other than that that story was focusing on the consumer level the individual level and then the next story looks at the global deal politics of gold and coal in fact it's called the geopolitics of gold and it's from gold money and it was written by a former guest here austan mcleod and he is looking at the fact that the shanghai

cooperation organization that region has basically cornered the gold market them and india. and because of this the result is that gold markets are now failing to clear the outcome is a choice the west will either have to stop intervening and allow gold to find a level where physical and driven if markets interact properly with each other or capital markets in the west will face a growing crisis likely to spill over into other markets while these outcomes were always going to be a choice to be made at some time in the future the disconnection between physical gold and derivatives has become so great that it is now an immediate concern fail to clear those are words that are really exciting to see and hear because it means that this markets in complete disarray so in other words when people show up to buy or sell gold there's not an offsetting trade to clear the price and what's happening is that the gold bullion banks the banks in the u.k. and in the u.s.

they borrowing gold from the central banks to make good on physical delivery which range at the gold in fort knox has been hypothecated it means the gold in the bank of england has control over has been a hypothecated and then re hypothecated as to say there's been loaned out to be sold into this marketplace so when the prices finally break free of the shackles of manipulation you see a ten thousand dollar price on gold which as i say there's a ninety nine percent possibility of that happening in the next thirty six months these central banks are going to have to declare bankruptcy so gold will keep going are similar will keep going iron of course but going will then break down and head toward much higher levels well he's suggesting it's the clash of the gold titans because the fact is that china russia and these other countries in the region including turkey and india that they know that the western central bank old boy vaults are empty so now they're just playing a game with a grand game of geopolitics of chess and they know that this is going to be well

what happens in any market when you know somebody is short and a great mass that you can force force a short squeeze you can force. bloody you play the players and this is what we're seeing on a geo political level mike we saw it recently with carl icahn knew that there was a huge short position an herbal life which is a ponzi scheme listed on the new york stock exchange and he went in there and he bought up a lot of the stock took it off the market and the other hedge fund guy ackerman who was our agrement who was short those shares is in deep trouble i kept getting margin calls and more margin calls so measured carl icahn is in charge of russia china and iran and these other countries gold buying policies and you can start to him and see the the problem that the west has going forward well of course in the west everybody's terrified of prices they follow price signals and that's it whereas in the rest of the world they're chasing ounces or cumulating ounces of the case of central banks tonnage and finally you know soc gen's albert edwards is also

saying the same thing warning stocks to crash gold to top ten thousand dollars albert edwards in a note that he wrote recently edward said that central bank stimulus measures will drive the world towards a global recession soaring inflation and a japanese style loss of confidence and policymakers quote we may have seen the peak of nominal u.s. g.d.p. growth for this cycle and unfolding recession should see a ten year bond yields dragged ever lower and the fed moving to q.e. infinity squared he said we want q e infinity squared that's a lot of q eight but i think it's important for people to understand that when the central banks are flooding the market with more credit remember all money is credit based there's no actual money in terms of it being sound because we went off the gold standard or a tide of the gold standard back in the early one nine hundred seventy so when they flood the market with more of this credit what they do is they don't actually extinguish debt they're not actually solving the debt problem they're giving more

pseudo collateral to various banks to expand their balance sheets. exponentially this is why we have this term huey squared which sounds quite remarkable something einstein might come up with when he's trying to figure out while traveling on a beam of quantitative easing what the world looks like from several hundred million light years away it would look like an enormous fear currency bubble bursting is what it will look like and it's important for people to understand that this money printing is not to somehow solve the problem is to throw gasoline on the problem because for every dollar of credit that these banks create another thousand is gen engendered into existence through the so-called derivatives market where it's now seven hundred chilling very important last week stacie a court in america decided that the seven hundred trillion derivatives market did not have to be regulated at all because there was a question that suddenly per some regulatory statutes on the books that they would

have to start raining in their derivatives trading which is now seven hundred trillion or fifteen times greater than the g.d.p. of the globe but that's now been eliminated so they're just making the problem a lot worse well to tie it to the top the money is being given away they're the equivalent of the prostitutes the over population of prostitutes here that are giving it away whereas gold is the way albert edward says is is the one that's going to give the world a spanking these derivative wielders giving away their free stuff spankie spankie stacey stacey thanks so much for being on the kaiser report thank you max stay to have a second half hour be speaking to mitch fires time. we'll talk about language well what i react to citrus i have read the reports but.

no i will leave that to the state department to comment on your. sir k.l.a. car is on the docket no. way to go no more weasel words. when you have a direct question be prepared for a change when you grow up one should be ready for a battle pretty upset ph and let up on the freedom to question. you raised. to believe. it's closed.

welcome back to the kaiser report imax keyser time now to go to misfires stein author of planet ponzi and the website plan of ponzi dot com hero here's the book

you know plan a ponzi now in paperback it makes an excellent gift mitch welcome back to the kaiser report thanks for having me back max it's great to be here all right first question you are the chart man you bring charts today's charts is the vix the v.i.x. futures tell us what is the vix and why are we looking at this well i think what we need to talk about is credit risk overall globally and what's been going on with the central banking policy the central banks would like to promise to you they've built a lot of castles at low tide and the tides about to come in the vix is the volatility index in the us stock market and for some reason as the volatility has gone down mysteriously from two thousand and nine the volume of these contracts has gone from about four thousand five hundred per day. to ninety five thousand per day which is an increase of about two thousand so no i was under the impression that sarbanes

oxley dodd frank and all these regulations that were put in place besides the ones that were recently authored by citibank i think or the other banking institutions were to cut down and minimize on risk so i don't know who's taking the speculative positions on the vix or why volatility has come down but if i were working for one of these regulatory agencies i'd certainly be looking into that you know credit credit risk has been totally perverted now you have high yield which is triple c. credit trading below five percent which is hard hardly realistic because the probability of a default is still extremely high for these corporations there's too much money chasing high yield right that five percent number that we see on the junk market is where the u.s. treasury body was only maybe six or seven years ago correct and seven months ago so in months ago you had the ten year trading at around one forty one point four zero it's a little over two percent now so triple c. is as bad as it gets but i think what you have now is

a coordinated central bank policy of triple d. which is divert deflect and deceive so basically what they're doing is selling to the public that this quantitative easing is going to work and i think that it's going to turn out to be extremely problematic we spoke about japan and what was going on in japan poland but we want to focus on vix for a second because the v.i.x. the vix this is the kind of like a barometer of what traders think is going to develop in terms of volatility you know vix the v. for victory is volatility and it's a way for two to monitor if you well the health of the market now if you're saying that the volume in the vix contracts as increased by two thousand percent and yet the price of the vix is actually down or trading near the lows. doesn't that suggest misfire stunt that just like gold and silver there's a coordinated effort to keep that price from telegraphing volatility from

telegraphing nervousness anything to get people thinking twice about stocks they're going to keep those things kind of muffled and down your thoughts you're right the volatility index is what it would have stands for that was created i think in one thousand nine hundred three and it if you push that price down artificially or somebody pushes that price down the way that it's hedge is by coming in and buying the outright s. and p. five hundred so people are going to buy stocks against it's going to push people into the stock market and make stock prices go higher if we look at what's been going on in the stock market since the one nine hundred eighty one i mean we've had it in incredibly bull market i think it's an increase of one thousand nine hundred forty percent or something like that. two thousand and seven through two thousand and nine so a record spikes in volatility we had big ups and big downs and big ups and big downs now that's been neutralized so what my point here is why is there are two thousand percent increase because the margin on each one of these contracts is so enormous that it's got to be a bigger much bigger to fail institution or two way too big to fail to get your

hands on manager said during those huge spikes in the markets did the vix show any correlation as i recall if the correlation is not too good at all and that there people are saying well there's a huge spike but look at the very next if there was generally some systemic problem we would see it trading higher right well that there was a there were spikes but they were not last they did not last at all and there were was a big seller there were always big sellers that came in towards the close every day there's a coordinated effort to push the price down so whenever you had a spike in volatility you'd have have a two or three day spike somebody would come in and bang it so it was a slam down there and so as the price signal from the vix i think it just like is the price signal from the bond market or the stock market or the current of the fall swap market or at the energy market they're all been proven to be complete. they manipulated are we getting price signals that are accurate from any of these markets i think this is the problem then you've hit the nail right on the head again is that the price markets are totally distorted so you've got risk trading

and my example was the triple c. credits are trading the junk bonds are trading below five percent should never be there which means you're going to have a catastrophic straffing wave of defaults you will have sovereign defaults as well and that's you know the end game that people want to try to avoid and that's why they're pumping so much liquidity into the markets eighty five billion a month the fed is pumping into the markets with the hope that things will get better soon and they haven't gotten better soon all that's happened or stock prices have gone artificially higher i mean if you look back into the japanese stock market the nikkei in one thousand nine hundred nine the nikkei traded around thirty eight thousand nine hundred fifty two or something and then in the twenty year cycle to two thousand and nine it dropped to something like seven thousand five hundred and change that was a drop of eighty two percent and twenty years. corresponding the dow has gone the other way so you know the dow still has room to run to the upside but how how much can a bubble inflate you know it depends who has the boy it's

a ponzi scheme which is what this is it's a massive ponzi scheme and i explain it in detail in the book is you know you replace the old dummies with new dummies and as long as you have money flowing in then it's going to go well if you have a printing press even better in till you get a bond market repudiation which is what is going to happen eventually people are going to say like in japan ok enough is enough i don't want the japanese bonds i've lost thirty percent and and we've discussed this before i've lost thirty percent of my currency with these bonds and now the yield is the yield is going up so the price is going lower so i'm losing two ways on this trade it's a terrible trade all right so bond market repeat another phrase would be a bond market vigilante they used to be a under clinton's days member he said i want to come back as the bond market because the bond market has all the power bond market under robert rubin when he was trying to get clinton to walk away from reforms that would have been beneficial to society at large they crashed the bond market they said all the bond market

vigilantes are going to bring some fiscal discipline to this market but they've all been neutralized quantitative easing there's by mark a vigilante and then this quantitative easing that those two are neutralized now we have the gold and silver vigilantes but they too and i have brought some gold and silver this is a gold sovereign from some sovereign somewhere in europe i see some eagles flying around with some dragons and whatnot i don't know what country this might be azaria it's an old austrian coin i see i could recognize that the see there's a little gold how much is almost an ounce here we've got ten ounces of silver and i love to do a silver is i like to drop it on the floor because it gives people the sense of how and how actually the mass of the silver as i did on this book tour after this this incredible bounce there. is that feel it is that like the japanese stock market bounce well the japanese stock market bounce is in. purging people in a genre that is my question the new goal is still a vigil at these are mrs wangel over there china is buying goal mrs watson abi in

japan is buying gold in other words people on the street are buying gold and silver because they they see the price crash as something to be love they love it they're not they're not being scared out of it they love it they buy it do they have the power to bring some kind of harmony back to these markets that are so badly stretched out of shape you know you're going to see a push there's a difference between paper gold as you've talked about on the show and we've talked about in the past paper gold and physical gold as i told you i was in new york and i tried to buy as much physical silver as i could find and the premiums are higher and nobody wants to sell the physical product when the price gets too low because you're getting your points in gold and silver where you're reaching the marginal cost of production once you get to those levels the miners are not going to sell them at a loss like the fed does they're going to shut it down so if it goes below a certain point obviously it becomes a buy and buy for the public it's interesting however to note for going back to the nikkei not that i want to dwell on it but. when we had a correction we had

a peak to trough correction about a week ago where the market decline ten percent in four hours and i didn't see that i mean that's major financial news i didn't see that on the head of any broad sheets anywhere or actually covered too much by the end of this last crashes that have become normalized you know back in the day when i was on wall street if you had a crash like that it would be new is the news cycle would have picked it up and talked about announcement completely normalised people just to know that most of the training is done by computers for computers by computers for the benefit of computers and that these huge gaps in the marketplace are just to be normalized of course until the day where you have a fifty percent gap in the price of gold is now trading at six thousand dollars an ounce talking about these price estimates the side of generals albert edward sees ten thousand dollar gold due to this quantitative easing is that where we're heading i think we can absolutely see five thousand or ten thousand dollar gold i think that the united states has blown its role as a leader and in the currency world because basically the value of the dollar since

the fed came around in one thousand thirteen in adjusted terms has declined by about ninety seven percent so the reserve currency status will eventually fade but that's going to take a bit of a bit of time for that to happen i think that there's a lot of optimism bias in every market that we see especially like london real estate ok let me jump in there because when you mention london real estate you think about this do help to buy scheme you think about george osborne and of course when you say george osborne you also think ponzi scheme as a matter fact the look of ponzi scheme now in the dictionary you see a picture of george osborne so tell us about george osborne's ponzi scheme and its help to buy scheme well it is a ponzi scheme it's one of the biggest ponzi schemes i've ever heard of and it's amazing the i.m.f. is against it mervyn king was against it i'm against it i don't know what your position is on it but the taxpayer this is speculative gambling by central bank intervention and governments with taxpayer money yet once again this is fannie and freddie mae. this is not only similar it's much worse because there are these are

the two that want to us that it was a private market that caused all the price of again it's just one of it's seen that it wants to mimic it right except on a much larger scale so what they're doing is providing part of a down payment and they're back stopping any mortgage provider for eighty percent of the mortgages which is crazy with no set asides there but it is a recipe for disaster in a market that's already overpriced because the historic norm in any real estate market globally has been three times income and there are pockets of london now that are trading at forty times income or fifty times income now you know the tax structure is different here than in monaco so i can understand why somebody would want to be in monaco london's a great place so you can't compare apples and oranges right what if we have to cut it off there at a time but thanks again for being on the kaiser report thanks again max thanks for having me all right that's all the time we have for this episode of the kaiser report with may next geyser and stacy herbert i'd like to thank our guest misfires stein if you like to send best and email please do at kaiser report of r t t v dot

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