up in facebook's i.p.o. price the grilled him for thirty minutes and when asked about the company's a future profitability the chief financial officer threw his hands up the saying i wish i had a crystal ball. and the subject of government surveillance did come up and reiterated earlier statements that uncle sam doesn't plug into figures but servers really really promises. and finally the new york fed and published a paper on his website that calls for the us to see the underwater mortgage is under the premise of eminent domain they would then be refinanced with government large debts repackaged into new securities and sold to new investors according to the wall street journal kicker will be author of the paperwork or now a law professor robert pockets once and drew a pay tag from the very company that first pitched the idea mortgage resolution partner. of course there was no disclosure of this until the wall street journal

made a few phone calls nice job or bad. and here is what's in your prime interest. good news everyone our goal is to see. earlier this year the l.a. times wrote the us government's gold and new york is safe and the vaults underneath manhattan and some of the precious metal there is purer than previously thought that's according to a first ever audit of the us gold on deposits at the federal reserve banks and new

york and elsewhere first ever audit one wonders who was counting the gold and beams over the last two hundred years anyways the problem is that the u.s. keeps only a small amount of its gold holdings with the federal reserve the bolt is warehouse and bases such as fort knox in tennessee and west point in new york is the military safeguards the bulk of the nation's gold not been mia york fed let's take a look now at just how much gold of the u.s. is supposed to own. as more than eight thousand tons are roughly five per cent of all the gold ever mind from the earth as a value of nearly four hundred billion dollars roughly six point five billion of this resides at the fed it seems as though perpetual thorn in the fed chairman bernanke you side ron paul was behind this audit idea in two thousand and eleven he

sponsored the gold reserve transparency act. we greatly benefited from a fool inventory. with detailed explanations of who the gold and who's responsible. terms. yes he wanted an audit of all the countries gold reserves not just those at the fed he also wanted to know if the new york fed had a loan or encumbered us gold questioning whether the fed might try to make money on the gold it's supposed to be safeguarding and does this by lending it to third parties whether they be other countries clearing houses or even big banks like j.p. morgan and goldman sachs and this gets back to the problem with this so-called audit it only confirms that the gold was physically present and at the purity it's supposed to be and there's really no confirmation of who owns legal title to what

congressmen and the us are worried about who owns their country's gold you have bet others are too and germany recently announced it will be clawing back three hundred tons over the next seven years about one fifth of its holdings with the fed while other countries follow suit the fact is that nearly ninety eight percent of all gold held by the fed is on behalf of other countries which begs the question of what happens if and when these places start withdrawing their gold in mess and as some have alleged it has been loaned out this could create some pretty sticky legal and political battles maybe someday congress will decide to open up the vaults at fort knox and find out for now the best we can say is there is a little transparency on the u.s. gold holdings.

we're seeing a lot of gyrations in the global bond stock in commodities markets gold has taken a downturn after a twelve year bull run in the united states the fed is hemorrhaging cash under a massive bond buying program with consequences that have yet to be seen japan is easing similarly but at an even larger scale relative to their g.d.p. . china's economy has slowed down after several years of self reported steady growth but what do we make of all this and what does it mean for the average consumer or earlier i spoke with the well traveled jim rogers and author of street smarts adventures on the road and the markets i first asked him about black markets

and what country today has the biggest black market. is still a theory as a big black market these days i don't really know any other so i go there i don't have black markets and i'm not sure what the very end but you're exactly right you know black markets think as if they are the currency tell you something's wrong you don't know what's wrong. like taking your temperature or you know you're sick. but you don't know exactly what it is it's a big question i don't really know of any black market right there i have to start trying to go some places that have a premium when i was thinking mostly of cyprus and what they've been through the past several months. i'm sure there's a black market for your insight but i just never been there. are a program. india where you also talk about agriculture and

you've spoken out why about how until it's profitable to grow food that we're not going to see today's farmers be replaced is obviously a huge problem so you when do you see the food prices on a global scale start to increase and what do you think we should do now to start to mitigate shortages. it's starting to happen now kerri-anne go to the supermarket or go to a restaurant and say that prices are starting to go up for food when you got to do something now i mean that farmers around the world are dying and retiring more people in america for instance there and setting public relations and study agriculture we don't have any young people becoming a most young people are not becoming farmers so the prices have to go up now starting now and they have to go up a bit but we're not going to attract capital labor and management into i reproached her and then we want to have any food at any price or about a serious crisis in the next decade or so this is not the next century this is the next decade or so i want to talk to another industry turning to gold and now you

did correctly forecast the recent downturn in gold twelve years up it's a pretty good run how long does a typical correction last and a secular trend and how patient might gold gold have to be. for a normal correction was in stocks bonds anything for a lot of these last a few weeks or a few months i orginally goat is going up twelve years at a row and that anomaly that's not the way market for it so i suspect this correction and go for have to last longer just to make up with a great period of the great twelve years i don't know i'm not smart enough to really know our area and you should probably watch prime interest to get a better answer i would suspect it's going to go on for a few weeks more and maybe even a year or two but it's going to set a set of bottom and all. the bull markets will allegations of manipulation in the

paper gold and silver markets are legendary in financial circles and some of the conspiracy theories to have been completely vindicated in recent years i know you're a long term investor but does this play into your decision making it in the gold market. you know i'm very skeptical i've been hearing those stories unfold and so over for at least thirty years. i'm not accurate if you asked me if people are worried about the price of gold they should look at india and india is the largest consumer of gold in the world in politicians and this repeatedly this year have been bringing out measures to limit the purchases of gold and they say they're going to do more and i was out when the largest purchaser of anything a so it's cutting back on demand it has an effect as i think it's fair to say about it what's going on in the world people should should watch prime interest or read the papers or watch what's happening over that's the largest customer and in the

wrong by the way they're wrong but they're looking for a scapegoat all of this is always look for a scapegoat you know we'll see more problems coming out of india and therefore it will affect oh but yes i mean if you don't have to get it first if there is but ignore them one deutsche bank is moving nine billion dollars worth of gold to singapore the nations they already have a reputation for respect of private property secrecy in banks for instance don't have to report encounters names to authorities and seek a form becoming the new switzerland. singapore has already attracted staggering amounts of money from from europe are there because the swiss that had such a monopoly you know that god corroded their god not the patient that got the expensive that god not very confident the results of the right so that many many many reasons that money is leaving switzerland people have been looking for and europe if we're looking for a competitor and singapore is turning out to be

a great competitor whether it's a new it's a new sports a lot i don't know i would suspect it will be. but i don't know if you're going to spend twenty years what i moved to sign up for us i moved to singapore not for that reason i had nothing to do with live here but that is something that i know i wouldn't do in singapore is it possible. singapore will buckle under pressure from states like the u.s. and eventually turn over customer records as switzerland suing over if singapore it was a just there's a reason the chart over the records they were sort of over this is not some kind of our inflated lockbox a secret they will turn them over if you could present a good reason. in this wouldn't be prime interest if we didn't take some time to talk about the federal reserve there's been a lot of chatter from fed officials feeling out that the markets might possible possibly see it raining and if q.e. the so-called tapering possibly as soon as the end of this year how realistic do you think this timetable is. whether the federal reserve raised it in or the market

forces them to it's going to in a dr bernanke you says it's going to last until two thousand and fifteen mr reich it doesn't know much about markets he doesn't know much about current or interest rates or finance so so tight so much that they have the is never ever been right about any of the public pronouncements the market is not going to let this play out you see what's happening in japan i mean the whole markets collapsing because people suddenly realized wait a bit this that i would go on forever in europe england us before now realize this is totally artificial describes going to lead on whether it is this year or next year it's four. because the markets are there let it happen now hopefully that the or the public the central banks around the world got their act together and stop it that it's not good for the world but even if they're not smart or that the market will force them to a bit. after the break we'll continue our interview with jim rogers giving his

a take on the farm and then bob inglis and i have a tasty menu of fat apologies tapering top don't want to miss out on. wealthy british style. time to retire the money.

markets. 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 in to the report on our. mission. critical three. four charges. arrangement three. three. three. three broken video for your media project a free media are t.v. dot com.

and welcome back to prime interest continuing our conversation with jim rogers we were just discussing terms were named keys decision to skip this year's jackson hole meeting something that's unusual for a sitting fed chairman i asked him if he thinks that this signaled bernanke he is on his way out next january and won't seek a third term. try to stay away too if i'd been as wrong as he has been over the past i suspect it does things like that for the say around if your doctor hasn't worked your get out to i made the results of this when were the reality sinks in and the next couple of years ago to be terrible the world's going to have huge

problems and if i were dr nike i wouldn't want to be around either quarterly but somebody else and blame it all but it's in a spreadsheet is probably neither one of these was called just anybody in dr greenspan to cope with that really messed up the world of the last i would try to get out to well let's go back to japan who has embarked on the most aggressive out of monetary and fiscal stimulus program in their history so called abba nomics and actually the end we can considerably over twenty five percent against the u.s. dollar and the japanese stock market went up but there's been egg credible ball until the end their bond markets and now the nikkei has given up significant gains you know what's going to happen next over there. good question barry yet if i were smart enough to know that i'd be rich but not if he says that he's not a dog to me mr babbitt has said that he's going to print unlimited his word unlimited about the money so he could make the pay and some kind of shining star of

inflation japan has got serious problems they've got that they've got a declining population yes i suspect when we look back in twenty years this will be you know the end of japan and everybody will lay out it goes to obviate the place a new currency is something that sometimes works in the short term but in the long term it's always willing to call that it's always always early because france tried it it like tried it pretty strident many people have tried it for decades but has never let's say also most or i think or in japan what's going to happen the short term i don't have a clue. i don't own any japanese sold all my japanese i or the little bit of this because it went down so much i'm hoping it's got a rally but i don't have much confidence in japan at all at the present was it bad it's a wonderful country was anyway well i know it's very difficult to time these types

of things and you said you're not the world's best market timer but do you think that japanese will have a crisis before in the us or even your. i'm sorry and i want to correct you on the world's worst markets because what that's what i've said and i am a very good question that word japan i would suspect i suspect that japan would have a crisis before europe those of. europe it's already said it's all of the way crisis so we all know about that the surprise the next the pros will probably out of japan after the election this summer you know the upper out a problem out of japan as alleged in the summer i suspect we were so i would say a serious problem after the election before the you know when those elections everybody everything together for the election after the election a lot of suspect there will be problems and certainly after the german election in the fall but goodbye been you know things in the cards are being

a part of many parts of the world given you said you're not the world's best market timer but you also noted the slowdown in the chinese economy and how this has depressed commodity prices but you're also on record as being bullish on china and their currency the rim and b. in particular so when what do you see as the middle ground here i mean how bad could things get in china and what would need to happen to finally see them deep hagon from the u.s. dollar. boy you know if i were china i would do it by two thousand and ten or two thousand and eleven or two thousand and twelve just shows you how much i know about when they got to. the chinese have no reason not to make their current convertible now i'm not chinese so obviously gotta do what they want to i would expect that to come any time now they've been making more and more strides towards opening it up as a response they've been opening it since two thousand and five and at least one thousand thirteen they've certainly made a lot of progress towards opening for don't. come any time

a problem in the next two or three years they're going the chinese have slowed down their economy for good reasons they haven't placement they have a property folks and they said we're going to do something about it and that they are doing something about it and as you know their customers america europe japan slowdown so it's not a surprise to me i do is watch prime interest read the newspapers and know that there's a slowdown in china it's. like a china have a recession and then in the nineteenth century is america was rising we had fifteen depression for the we did a pretty good job in the twentieth century so china can certainly have slowed down the idea that china cannot have a recession the poppy crop. and that was my interview with gemma rogers the author of street smarts.

and the daily deal with. hungry they were cut off later sounds good all right get started well john health and wrath the unofficial fed spokesman at the wall street journal was added again yesterday apparently fed officials don't like the word tapering right and that's the plan to wind down to a bond purchases which are currently running at eighty five billion dollars per month in the theory about tapering is there will be a gradual reduction of q.e. bond purchases over time to ease the amount of shock to the markets and even though a set officials use the term tapering themselves i guess they're having second thoughts anyways and here is what health and raf wrote or this is a quote because fed officials are uncertain about the economic outlook and the pros

and cons of their own program they might reduce their bond purchases once and then do nothing for a while or they might cut their bond buying once and then later increase if the economy falters or they might indeed reduce their purchases in a series of steps if warranted by economic developments but they don't want the markets to think that's a set plan it is as fed officials like to say data dependent dependent and that pretty much gives the fed leeway to do anything and everything and then reverse on a dime maybe every fifteen minutes or so and this directly contradicts the historical pattern of the fed which is that they would raise interest rates over a period of years in the lower and it just seems like bernanke you can do anything he wants now willy nilly and let the markets be confused in the meantime exactly so we've come up with and. our own little fed menu. and here is here is what it is at first we have a slow cook to entrust reserves on. accessories right so you're from the

south you like slow cooked meals don't you. exactly ok what is what's the point here the fed can raise interest on excess reserves over time to keep all that money that's parked at the fed one point seven trillion dollars in excess reserves but you know that money is going to go to the big banks right now it's going to the treasury because if that is paying such a little amount of interest rate but like i said that's going to change eventually you don't have your own final there you know i don't know where. i've next we have marinated at mortgage backed securities a hint of a negative kind of exit this kind of sounds like something only you could. you know actually it was cooked up by bernanke himself when he decided that he was going to depress mortgage backed securities or the yields of them to make housing more affordable for everybody and support the mortgage market and this was several years ago as part of q.e. one and he just couldn't stop he's been doing it ever since it's been crazy yes it has also flash frozen fed the bills the hybrid for future consumption kind of

sounds like something i saw on your desk it's probably still there and it will be next week to clean that up anyway this is the third term deposit facility it's another way of the fed being able to keep money in the federal reserve as opposed to out in the system creating price inflation maybe hyper inflation it's kind of i call it a fed bill because it has all the characteristics of a treasury bill except the fed is issuing it and paradoxically enough the fed isn't really supposed to be doing this kind of stuff but it says it has that authority and on this side you can have pickled reverse of repose and fused with the money market fund liquidity i think only you could during something like that. but bernanke is going to have to drink it himself. as these money market funds have a lot of cash and bernanke has decided that he wants to be able to tap that cash there's too much money in the system now what is a do for them in a liquidity crisis i don't know but it doesn't sound like it would be very good for

the money market fund holders and that includes people like probably you and me seems like we have interesting futures and are in our future yes now on in germany there are a bank employee fell asleep on her desk and accidentally transferred to two two two two two two two two point two two euros per retiree in the bank account the correct amount was only sixty two point four you're out of this up and she fell asleep at her desk you know that we've got the will of the desk and what would happen if the fed to this maybe that's how we got this crazy policy of q.e. in the first place very possible all the woman lost her job rightfully so i don't know about that i mean the bank had internal control systems and you know they caught the error before it was made so i don't think it was a situation for them well she got her job back good for her thanks for joining us you can follow us on facebook at facebook dot com slash crime and trust in follow

bob on twitter at english and you can follow me at perry and r t bob thanks for joining us i do. and it was a globe trotting day here at prime interests first we tracked to silicon valley to see mark zuckerberg going palms begging for absolution on facebook flacid share price given twitter were nearby petitioning uncle sam for permission to release their snooping details when we say. although over to singapore's account would be an estimable example rogers as he led as through the office of dental oriental central bank or door good luck all bank finally we doubled back to the basement of

the fed to find john hilson rat and ben bernanke be breaking bread outlining the fed's next p.r. campaign well thanks for watching come back tomorrow from everyone at prime interest i'm carrying boring a great. live live live live. live. live. that's to be. her.

mother a little bit misleading good. luck. with. a little. live live. live . live live.

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