suggestions i'm always listening but for now have a great night. i would rather ask questions to people in positions of power instead of speaking on their behalf and that's why you can find my show larry king now right here on r t question more.

good afternoon and welcome the prime interest so i'm terry and boring i'm in washington d.c. let's get to our headlines. disappoint the markets that is always a bit of a long shot of the european central bank she put further ease rates after rising at the last meeting that risk market sold off on the new some are close and during a bear market territory our poll twenty percent decline off last month we talked today with head hedge fund manager harrington and all of this and more. and you probably heard of or high frequency trading but there's another meanest sounding corner of the market called dark pools in the private exchanges where traders can make big transactions and stocks without tipping off the markets that the rest of us trade on the wall street journal reports that the regulator is probing into the shadowy corners and now command about thirteen percent of all equity trading some

of the largest our goals are operated by barclays goldman and create sweets and is attempting to determine if the perms priority area trading is using the firm's own dark pools to manipulate the market. finally more bad news for our fair headed once favorite banker jamie diamond looks like j.p. morgan is set to lose one point six billion dollars on some allegedly shady deals with jefferson county alabama according to bloomberg that's because it took the lead in arranging risky security deals that pushed the county into the largest us municipal bankruptcy good luck at the next shareholder meeting to be let's get to what's in your prime interest.

during the financial crisis the term too big to fail came to prominence as the federal reserve and treasury arranged for bailouts for some of the largest financial institutions dodd frank attempted to remedy this by creating the financial stability oversight council or we call f. stock is composed of representatives by most u.s. regulators and is chaired by the treasury secretary jack lew is mission is to basically get rid of too big to fail by first identifying potential large firm threats and then monitoring them along with the markets on an ongoing basis it has already designated certain banks as the cynically important financial institutions or cities and as stock had them submit so-called living wills these are plans to wind down the financial firm should it become insolvent but it's not only banks

that can be designated at cities insurance companies clearing houses and others could potentially cause systemic risk as well and only recently three companies to insurers and one lender and now if they had been sent notice by of soc that they would be on this list too we're joined by kyle harrington of harrington capital management to discuss this and what's been going on recently in the markets thanks for joining all thank you for having me it's a pleasure and we recently saw that stock headed by the treasury department tentatively designated a id prudential financial and g.e. capital as systemically important or safeties what's the significance of this expression when it comes to new regulation of these entities. well you know i'm not a supporter of too big to fail i know that currently throughout wall street throughout the financial communities both insurance and big broker dealers we are

going through a process of how to regulate better regulate these institutions and i i support regulation what i don't support is over regulation and it seems as if they're going to designate some of these bigger players like a i.g. like credential and put them in an area where the federal they're regulated on a federal level so that we don't have what we had in two thousand and eight where taxpayers bailed out these major institutions like we've never seen before so if it's going to better regulate them so that we can prevent that i support it but what i don't want to have happen is that tend to loom swing so far to the regulation side that these businesses are not allowed to operate in a free market economy. are there any other non-bank financial companies that are thank you needed to be designated as a safety. well you know i'm hearing some of these others you know some other big

insurance names like all state and maybe some other bigger financial institutions that are more on the brokerage side of the business as well i don't want to speculate necessarily but i am hearing that the umbrella may widen in terms of these moving from state regulated entities to federal regulated entities ok it will both a.i.g. and g.e. capital they were bailed out during the financial crisis a.i.g. to the tune of one hundred thirty billion dollars g.e. was given one hundred forty billion dollars is this if he does a nation really mean that the next time if there is one that they won't be bailed out i think that that's you know that seems to be the insinuation here and i you know in that way if you if you listen to the g. c.e.o. he actually is he wasn't necessarily disagreeable with respect to the new designation for a g. so. i think that that's kind of what they're hinting to is that you know there's

not going to be any more bailouts and you're not going to be too big to fail any longer so what we're going to do now is regulate you at a federal level maybe more stringently so in that way i think it would make sense let's just see how these how the regulations fall into place because you don't want to stifle the free markets and the economy with respect to these banks in the nation is not final because there has to be in a process. that is going to go through the final ruling will be made by treasury secretary jack lew when he makes this sign off because of this absolute itself did not reveal the company's names he left that up to the companies to voluntarily and now it's back to the markets. why do you think that they these companies that go ahead and do that. well i think you know it seems as if in today's world full disclosure and timely disclosure the market at least has the ability to digest in a lot of these c.e.o.'s now given some of the other issues with say lehman brothers

for example or bear stearns you know disclosing something early on i think allows shareholders to feel some level of comfort. in the stock price and the future and so the chairman coming out disclosing that and then saying that hey actually i think this might be a good thing for the company prevents less volatility in the stock price so that would be my reasoning for why they would come forward and disclose this but like you said there still needs to be a process and i think a two thirds majority vote in order for them to be designated as such now standards and poor and nouns that a.g. would be joining the s. and p. one hundred index just minutes before an idea and now that it was as unpaid at fifty could there have been any relation between these two events and you know again i don't know i don't necessarily want to speculate but it does seem coincidental that these two things happen at once and oftentimes a lot of these bigger institutions if they're going to make announcements that are

significant in nature maybe making them all at the same time you know makes a lot of sense so it does seem coincidental but you know i'm actually i'm for the disclosure and for these companies coming forward and if there's something that's immaterial of events like this i think it's helpful for these bigger companies to do that and why have you here i want to talk about the markets in general and last month the fed made noises that it might be might begin tapering or slowly reversing the quantitative easing program perhaps as early as the end of this year and we've seen significant market correction since then what's your view on the markets now can we be entering a bear market anytime soon yeah you know it's interesting i've. actually not off not that often but in this time i've been i think spot on with this market you know i thought that all along it's gotten ahead of itself i want to address the fact that we are on our way to seventeen trillion in national debt we have

a sluggish g.d.p. our employment marketplace still seems to be over seven and a half percent nationally and so i expected there to be a sell off now with the fed talking through the notion of not buying back. and getting involved in the treasury market as much as it has over the last year i kind of sense that people might be a little bit hesitant to put capital at work especially after a dow jones and s. and p. that's run up significantly in the year of two thousand and thirteen so we remain very patient and i think we're going to continue to do that we're going to investigate names that we think may be and have continued to be out of favor and are reasonably valued and start taking position in those names but we're not going to rush to put any cash on the sidelines into this market at a at

a fast pace well what have the recent market moves been doing to trading firms that engage in trend following strategy. well you know i think that you know if you look at the overseas markets in japan for example i think that that's an in over inflated marketplace and so the short term traders have gotten a lot more active in watching trends that are taking place and looking at the monthly numbers that come out like the jobless claims number or like consumer sentiment consumer confidence and so for the short term traders they're paying a lot more attention to trends and getting in and out of positions. as they see trends start to you know unfold and right now we're seeing a trend although the market closed up i think the dow eighty points today but it was it had sold off for most of the day so that was a sign of a little bit of confidence that maybe at this fifteen thousand level for the dow jones there is a there is a floor and the japanese markets have been extremely volatile both on the and

stocks the nikkei was first up sixty five percent this year and then it was down one thousand percent from that high you do you think that the massive stimulus program over there has been a failure. i think that it is hyper inflated over inflated whatever word you'd like the market significantly i think we suisse we have that here is well we have historic low interest rates people are not really interested in the bond markets because there's no real rate of return in fact you know that when you look at a ten year treasury it doesn't even touch the rate of inflation if you look at say a three percent inflation rate i think the same as happened in japan i think what needs to happen in order for a healthy marketplace in this free economy to take place in both japan and in the united states is a real deep examination of the expense side of the income statement that the united states government has and that means looking at entitlements that leo that means

looking at expenses that we can trim in order to really get this deficit in a better place or at least paint a picture going forward that we have a grip on our expenses as a country and then also the the employment marketplace needs to pick up and i think the way you do that in is to really get a hold on what taxes are going to be loosening some regulations at the entrepreneurial level in these banks starting to lend again and i think everybody's cautious so i doubt that's why i believe the market has got it gotten ahead of itself in both japan and the united states and you know i would say be cautious get with someone that you trust as an advisor and and really build a plan that you think is is it takes advantage of what's going on in the market right now and now you work for a number of large banks and brokers before you start your own firm or with merrill

lynch going to banks and goldman sachs what is the difference in the corporate culture is that after those firms those of the you know people realize there is a big difference in a lot of those firms and and some of them are good some of them not good some of them good for me not good for me i started my own firm quite frankly to build my own corporate culture and. you know at a goldman sachs it's i think i can just specify that it's a lot more about teamwork and some of the other places it's more about more the individual so. they're very different in nature they're all successful in what they're successful at and the negatives you know they you know there's a lot more regular regulatory scrutiny now and i think some of those cultures are more conservative in nature and some of the more not so conservative right now i think in order to succeed with regulatory environment being what it is you have to

be. a lot more cautious very well thank you so much for joining us this is kyle harrington herrington capital management thank you so much. and stay tuned because up next we dig into the final print of money market reform what's in store for this two point three billion dollar industry that nearly imploded in the last financial crisis then a prime interest producer bob inglis and i have those dots weren't the all over the five apology major that are best or worst suited for the financial industry. wealthy british sign on the sign. is no time to read the tirelessly. lead markets why not. come to find out what's really

happening to the global economy with mike stronger for a no holds barred look at the global financial headlines tune into kinds a report. you know sometimes you see a story and it seems so poorly you think you understand it and then you glimpse something else you hear or see some other part of it and realize everything you thought you knew you don't know i'm tom hartman welcome to the big picture. the worst you're going to face the only white house of the day the radio guy for the tale of minestrone cricket because they want you to watch what we're about to give you never seen anything like this on trial.

one of the largest credit markets in the u.s. might have a bite taken out of it yesterday the f.c.c. release a proposal for major reforms to the money market fund industry which is causing a bit of controversy for delegates one of the largest money market fund groups claimed that these changes would destroy money market funds this sounds a bit scary because money markets are eight point six trillion dollar industry so let's take a look at exactly what is going on with this. proposal is intended to prevent massive runs on money market funds like those seen in two thousand and eight during

the crisis the reserve primary fine took major losses on trades with lehman brothers it could have maintained the inspector expected one dollar per share price in other words it broke the buck this prompted a run on the firm and subsequently triggered a run on the entire industry money markets are a major source of short term funding for companies and eventually the government stepped in the backstop was no small feat. cells are emerging today about a secretive treasury department program backing nearly q. and a half trillion dollars in money market mutual funds here's the kicker congress never authorized it a lot of. the as he sees planned comes after a year of internal disagreement over how to draft the new rules now earlier this year we asked as you see and our own chairwoman walter about the proposal. we're working very far in internally on putting together a proposal to put it out for comment i would much prefer to see

a proposal be put out by the f.c.c. and by the. end it was this proposal that was finally released yesterday so what is in it. as the rules stand now every mutual funds a net asset value is point nine nine five rather than a dollar fine round up and report that everything is valued at a dollar however the proposed rules require a net asset value to stay closer to a dollar specifically within one two hundredth of a penny a drop in value below this would cause the firm to break the buck however according to the f.c.c. rules they would provide exemptions to the floating net asset value requirements for government and retail money market funds see reasons that because retail investors can't withdraw more than one million dollars from a fund per day there is a reduced risk for a run so given the tendencies of retail investors to continue to hold money market

fund shares in times of market stress and it pears to be necessary to impose a floating net asset value requirement on retail funds how nice of the s.e.c. to expect retail investors to want their money back in a survey conducted by a treasury strategies of money market funds were required to use floating net net asset value twenty one percent of respondents would continue using funds at the same level while seventy nine percent would either decrease or stop using that money market funds all together and the f.c.c. is well aware of the potential damage saving that could result in contraction and in the prime money market fund industry but tenderly hammering the ability of money market funds to compete in several respects affected by your proposal. seems perfectly all right with reducing the size of a money market fund industry even suggesting

a list of alternative investments public comment in the proposal will last ninety days so make sure you get your thoughts into this. time for the daily duel with bob angle it's good to have a job here at r t isn't it perry absolutely things are joining us so a recent harvard university study revealed that only fifteen percent of the graduating class plans to go and find this is down from forty nine per hour forty seven percent since before the financial crisis of two thousand and eight last year only nine percent of the graduating class actually ended up in finance but if you

are a harvard student where if you ask them where they would like to be working in ten years only five percent said fine here and that's that's kind of a big change because we we saw the industry was clamoring for these harvard grads before and now they're just laying people off so what's what's up with this i mean we're really starting to see what jen rogers is famous for saying which is that finance and banking is a dying industry and that if you really want to be successful and now you know our age range to study something else he says agriculture ok it's kind of like the dinosaurs they got really really big and then they just they were. when you were in they were not too big to words and jim rogers. well i think it's just you know important understand there's other places to go to finance and things like you know well maybe they could come right here to k. street which is the regulatory street that's famous in washington d.c. when you think about that well there is definitely plenty of money to be in on the

case street washington d.c. is expanding every day both on the lobbying side and on the other side which is in the actual regulatory agencies and we see we talk about that revolving door all the time you know a lot of interest and the government sector. it is growing every day. it's good industry in washington d.c. and georgetown university they collected data on the education workforce forbes compiled a list of the ten worst college majors at the top of that list was anthropology and archaeology which has an unemployment rate of ten point five percent way above average the national average and among recent grads the median earning is twenty eight thousand dollars a very much a living wage and those are important industries but when we see the finance industry and deutsche bank particularly laying off thirty five hundred you know employees at a time where are they going to go i mean they have to this has to do with the whole reemployment thing in the student loan bubble that we're seeing when the government

guarantees student loans the universities have the ability to price increase the price of tuition and that's exactly what we've seen so we have a lot of people coming out of college and maybe not all of them should college just throwing that out there well actually do agree with you on that i think you know not everybody is meant for academia they're just not i mean i can i mean there's plenty of other industries that people can be involved in i mean we need we need farmers need people to drive tractors we need. there's plenty of other job that i think are going to shock the world always needs to it's terrible. all right well bob and i have decided to hire our own list of the five words college majors to become a central planner regulator of the financial industry number five is ethics to become a successful in finance you should a lack compassion or emotion and always be open to a good bright well i think that's a little bit harsh maybe i mean there are there are some on it's people on the regulatory side but i think when you get to the very top structure yes there is

a certain amount of ambition that goes with the position and has higher growth you know the cream does not rise to the top when it comes to these state sponsored jobs in the central planning your time you tend to get the worst i mean i sure hope you're right. we've seen a lot of amazing scandals in central banks and the primary dealers. certainly. moving on to number four is a logic that because you can see in central planning response to just about everything has been completely illogical based on the simple but flawed premise that debt and monetary inflation well when you think about that i think you need some logic to be a central planner i mean after all you're dealing with the world economy and yes it's rational at times but there have been times where it's been stable as well yes and that's all the models that we have that are kind of guiding you know the bernanke use of the world are based on maybe fifty or sixty years worth of history

and what they fail to take into consideration even though bernanke he was an expert so-called on the great depression i don't think that those lessons are incorporated into the modern economic yukon and metric models and that was one of the failures that we saw during the financial crisis and what came out of the great depression was the great moderation or eventually yes after walk after world war two definitely so number three is history because this time is different of course well and different because as i was saying you know they're not taking into consideration this generational super cycle that we have that we're also seeing the debt supercycle in the markets right now and we've got to get to number two and one real quick. because all the world is a stage and practice makes perfect but that doesn't necessarily mean that doing the same thing over and over is going to work. i mean i think to be essential planner you definitely need to have some type of speaking ability yet to get out and get from the market again from the world and whatever ok we're going to have to you're

going to have to skip number one here but i think we do have some one of the worst major to study is in finance in science because there is no central planning that actually works you're better off studying. magic so mass what the bankers of the bankers seem to be doing with all the money printing so thanks for joining wagner do if you want to follow us on facebook we're at facebook dot com slash prime interests follow baba english p i and you can follow me at hereon r t on twitter. it's been a day of disclosure and of security on prime n.g.o.s we first like them mario public announcement that the e.c.b. would hold steady would would have would hold steady there price inflation and

a super power ups for you to asia and santander then we peered into the athlete named world of dark pools after a couple of laps in the deep end we concluded that we'd rather do the heavy swimming and another day another one point six billion dollars down for the orwellian fortress balance sheet such abilities a whole designer once reserved for goldman now proudly perches on top of the house of morgan easily swallowed in a flap dragon dear jamie we shined a light on money market reform only to find values not jiving with not assets and our conversation with kyle harrington and more then a little money to the way too big to fail firms are gathering under the bad new bro thanks for joining and parry and boring at prime interest have a great night. if

you live on one hundred thirty three possible for food i should try it because you know how bad the less bad luck i've seldom skinny i mean. i know that i'm still really messed up. in the all clear it's all bullshit leopoldo the. worst chipotle is playing the white house of a. radio guy and for sale minutes from a critic i. want to watch quote because you've never seen anything like this i'm told. everyone i'm having martin and this is breaking the set so this is going a brand spanking new.