and good afternoon to welcome the prime interest coming to you live from washington d.c. i'm harry i'm boring let's get to today's top story. now prices are rising according to the latest consumer price inflation statistic released this morning both headline and core are up two percent year over year and monthly price inflation was up zero point seven percent after no change in january no need to worry because the fed defines these prices as stable and speaking of the fad of burning the app after john hilson rabb came to the markets rescued yesterday causing a late day rally to wall street journal correspondent said that we've taken the fed's recent tapering comments too harshly it's all just theater you know the fed

has one thing in the markets go down in the us james does another in the market go up anyway the latest episode of dancing with the fad of fate that features the bernanke and you won't want to miss the amusing episode next wednesday when the f o m c attempts to correct current market expectations. finally do you remember the independent foreclosure review which both the fellow reserve and the o.c.c. signed off on well the ten thousand displaced homeowners who got pennies on the dollar for their trouble still do senator elizabeth warren made some inquiries and mid in february to the federal reserve and it only responded recently the board of the federal reserve decided it wasn't necessary to vote on the settlement conditions instead of delegated authority to its staff and a reminder the report which was supposed to be used to determine how to distribute three point six billion dollars in settlement cash from the big banks which quashed once whistleblowers raised concerns about its integrity occur and apparently the

fed's general counsel got out. whereas decided unilaterally and five thousand dollars a year home was a good idea. and here is what the new our prime interest. i . in our interview last wednesday with jen rogers he told us that he didn't believe in gold or silver price manipulation. the theory was there were there were at least thirty years.

or prime interest producer justin underhill is here with her charts and she took an end up walk where some of these claims of gold manipulation might have come from. just being can you just tell us about what you found chart well i won't get into the merits of gold manipulation or silver manipulation but what i would like to highlight today is the divergence of the prices between gold trading during the day versus overnight gold trends on exchanges all over the world during the day in places like london and new york and overnight in places like singapore and this line looks at the trading during the day of gold in the london and if this is what happens if you were to buy during the day the intraday price from this is from two thousand and one to two thousand and twelve so let's say there is a hypothetical fund that starts with one hundred million dollars in them in two thousand and one and they invest that and over time so this is one hundred using

this this over here over time if they bought at the open and sold at the close it by two thousand and twelve. elves it would be only they'd only have thirty one million dollars left that's a seventy percent loss and if otherwise gold was rising at that time by over four hundred percent on the other hand looking at overnight trading in asia this is the shows what would happen if the funded the same strategy as safe took the same hundred million dollars they would have fared much better and by the end they would have had a rise of up to nearly two thousand that's a fifteen hundred percent rise in the time of return and this return is many times higher than if you were just simply bought gold and held it from two thousand and one and gold is gold no matter where it trades and that's curious to have such discrepancies in these overnight verses intraday markets for such a long period of time well do we know if these differences are due to well there are many different claims so some people point speculate that central banks are

manipulating gold prices whereas others simply say that maybe the. market participants are more bullish on gold was all very interesting because so much just saying thank you. i. know one of the defenses of the n.s.a. spying program is that it has prevented terrorist attacks the f.b.i. director robert mueller testified in front of congress yesterday and he said that it could have even prevented nine eleven now earlier i spoke with andreas am answer was he's an expert and distributed systems and security and i asked him if this is true can these government spying programs really prevent terrorist attacks. when

there were terrorist plots have been thwarted. the government is the first to leak their own information in order to go wrong about the successes of these programs and in fact what we've seen by informed people is that this isn't helping terrorism or rather the opposite we should consider this sloppy lazy security taking the data three hundred million americans and presumably another couple of billion people from around the world and putting it in one big data center and then keeping it safe by giving access to about five million people well that's not good security what that does is it opens us the possibility of hackers accessing that data of mid-level bureaucrats accessing that data and worst of all even if we trusted the current government to handle the security of the state oh well what happens with the next one is it possible that with the vast amount of data collected on each person could these be used and i think fishing expeditions where the verdict comes before it not only at trial but before

a police investigation. well absolutely i mean we saw an example of a lawyer caught in the internet of suspicion because his fingerprints happened to match those of the bombers in seven seven in london and that person had their life destroyed general petraeus lost his position because of a fishing expedition that went wrong basically this is going to keep happening and of course for most of the cases will never hear the truth so when you collect data on so many people the number of false positives increases far faster than the number of actual leads security intelligence specialists really focus on human intelligence is the best way to track down real threats this type of trawling expedition is really lazy sloppy security it's what an organization that has eighty billion dollars no oversight and no clear strategic direction does when the easiest thing they can do is just vacuum everything and leave the consequences for further consideration the consequences for us are very dire and if they're in the themes

that there is substantial potential for abuse in their. as who is the most except of all. well anyone who speaks up really essentially the real threat here is the chilling effect this has on anyone who poses any form of dissent already you hear calls in congress of calling greenwald who broke this story on the guardian a traitor and talk about prosecuting journalists this is our current congress saying things like that so what happens if the next congress actually decides that's a viable and lawful exercise you know we should be very worried about the use of the work lawful in these circumstances because it makes me worried about what else is considered lawful and what else we're not being told so even if it's only applied to the people who speak up and most americans will say look my email my facebook doesn't really have any information this worthwhile for the government well that's because you're not doing anything that annoys the current government but what it means essentially is that people who disagree people who have differing opinions from the current opinions of the government may be hounded and prosecuted

unfairly and essentially will not speak up so we have a democracy where opposition and dissent is not welcome now even with the current government we see that and certainly past governments and for the most part they're probably using this in a good natured way what happens if we elect someone who's wrong so we want to election away from this turn teetotaller terran infrastructure being turned on the american people in the world we've never vested so much power in so few hands and the founders of this country warned us against that can you elaborate on the turn key at the top tarion infrastructure. absolutely i mean essentially what we're doing here is we're saying less trust the government that they're going to use this data for good but all that means is that this data will continue to exist once we've opened a store this data will exist forever and will be available to any bureaucrat from the mid-level all the way up who can use it for any personal grudge or for political so what happens if we elect the wrong governments what happens if we

elect a government that doesn't care about our civil liberties or doesn't even pretend to care about our civil liberties you know this stuff. it would be envious of this kind of level of surveillance if they had it in their hands if we ever elected government that that actually has ill will towards democracy we're in deep trouble because there will be absolutely no stopping them they'll have enormous power not only to suppress dissent but also to make sure that nobody really notices that the sense occurs because they'll suppress it before it becomes public and i first met you at the big point conference in san jose last minute and you talked with our producer bob what are the implications for alternative currencies such as big coins that are supposed to be somewhat anonymous as. well because in another crypto currency these are not really anonymous they're sued on the most you can do or draw a lot of inferences from the metadata from which you caresses or spending with which other addresses so bitcoin is very susceptible to this kind of meditate on information gathering and in fact it makes it very dangerous for those types of

cryptocurrency is when you have this kind of information gathering but it's no more worrying in fact it's less boring than the kind of surveillance is happening on credit cards and payment networks we already know but it goes way beyond telephone calls pretty much bank accounts credit card accounts and any financial transaction you do now is in this vast prism data system so it will be just one more piece of metal data collected against people well the bottlenecks in big coin and similar and similar currencies as that most people need to obtain them by exchanging dollars or euros or other official currency and governments have already cracked down on several exchanges such as mt gox might we see this trend accelerate. not really i don't think so i mean i think what we see with the crackdown on some of the exchanges is really just bringing them in line with the regulations for the

money laundering the know your cost there which they're required to follow it's a very expensive thing to have to follow these regulations especially when you. i have to register as a money servicing business in fifty states but that's what you have to do in order to be part of the financial system and so i don't really see any crackdown or any attack against the coin i think we've seen from the fence on the financial crimes and forstmann network we've seen that their guidance really sees bitcoin as neutral they're not cracking down on it what they want to see is regulation being followed and that's a perfectly reasonable application of the law absolutely and you also worked in the banking industry years ago. are there any parallels between what you thought in terms of data gathering and what the n.s.a. and other agencies are dealing. well you see private corporations do an enormous amount of data gathering in order to understand their customers better but there's a very big difference and a big difference is that these private corporations don't have the backing of law

and the backing of force behind them so even if a bank gets annoyed with me and trawl through my bad data at most some kind of low level employee in their could make my life inconvenience for a while and then i could appeal to the law to stop that who i peel to if the one who is hounding me is the government if you're a journalist and you're being hounded by the government who do you appeal to then so that's the real concern here there's a very big difference between corporations collecting our data and government backed with the force of law and threats of violence collecting this data and using it against its own citizens these types of journal warrants are explicitly prohibited in the constitution and i don't care how many judges will senators say this is ok you can't authorize general warrants it's right there in the fourth amendment. and that was a security expert under a us am and to no puss and stay tuned because up next we can tell you to talk about the n.s.a. whistle blowing scandal and privacy electronic communications which traces the

mayor he is the owner of how to vanish dot com then bob and i have taken to the mailbox bag and answer some interviewers question. i would rather as questions for 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 our t.v. question more. last

time was a new alert and secrets scare me a little. there is breaking news tonight and we are continuing to follow the breaking news. alexander's family cry tears of the war i. think. that there's. more of a war zone. there's a story. playing out in real life. and

just over a week into the n.s.a. spying scandal edward snowden can ten used to make headlines as part of a flight to evade extradition back to the u.s. episode raises the profile of security implications for our privacy in terms of communication and purchases here discussing this and of more is tracing mayor he's the owner of how to vanish dot com thanks so much for joining us good to be here parry and now we first met at the big point conference in san jose last mind and privacy is certainly an issue with bitcoin and there is a new messaging service that's being built on a similar technology called message could you just tell us a little bit about it and how it relates to virtual private networks. that message is great because even though it's still enough it's a very new project. we've been talking about how the n.s.a. is collecting all this method data. it's collecting who you're sending

a message to who it sent from perhaps the title or the date of the message with bit message you're basically able to send e-mail but you're able to do it in a way that you don't have any of that method data out there and so it's not even there to be collected and this could be extremely important for people to protect their privacy because as we're seeing over in turkey they're they're using the twitter and things like that to figure out who to go arrest and so if you want to be able to communicate but not necessarily establish those lines of communication the could then be used to create the social graph you can use these tools like that message and so it's going to be very exciting to see developments come out of that and there will be a whole bunch of other implications with that for example using bit messages. to broadcast order so having a decentralized exchange among these cryptocurrency or things of that nature so it's very exciting to see some of these crypto tools that are really starting to

get a lot of adoption and also development happening on them since coin came out right and now are themselves are not necessarily and not a myth mainly because if you use traditional currencies that buy them there is going to be a paper trail but that method is does does that methods have this limitation and i mean is it truly anonymous. and well bit message you're still dealing with you're still dealing with what's called the private key but the messages themselves are going to get sent out and they're encrypted and so you have to be able to decrypt them in just like with bitcoin you've got a public key and a private key and what's exciting about this is that asymmetric encryption really tilts the economics in favor of the individual as we've been talking about our privacy is under attack and that attacks our individuality it attacks are a. it would be in our in our autonomy our ability to keep secrets and this is

asymmetric encryption you know no amount of violence is going to solve a math problem and it acts as a force multiplier on those who try to breach our privacy and so you know i think that freedom that's going to become increasingly aware of good you're going to have to be able to pay for it you're not going to be able to free ride off of the founding fathers contribution to it but you can take control of your privacy and that's what we really teach people to do over it how to vanish now all of the technology to send encrypted messages called p.g.p. are pretty good privacy it has been available to the public since the mid ninety's but it has yet to gain widespread use and why is this and does that message have the potential to obtain widespread acceptance and use. well i think one of the reasons the these crypto tools have not really gotten a lot of widespread use is one there they can be fairly clunky and difficult to use

we need to have the interfaces and the inner infrastructure and things around them built in a way and you know somebody has got to pay for that development at the end of the day and if people don't like and want to take control of their privacy and if they don't want to pay for their freedom then they're going to lose it and you have to pay for it in time and money inconvenience all of these are different costs that we have to pay and usually it's a tradeoff between what you want to do and so you know sometimes it's going to be very expensive to have your privacy to really high level but there are some things you can do where you can spend you know eight or ten seconds and no money and yet you can make it so that it costs hundreds of thousands of dollars to breach that privacy and so it's really about finding the tradeoff in the balance that each individual wants with their privacy and then which costs are willing to pay and where to get the most bang for the buck but now if these allegations of n.s.a.

spying are true then that means that there is just a tremendous amount of information that's being collected and there is a lot of money to be made by trading privileged information now is it possible that people with a clearance could abuse their access and use this information to their financial advantage and if so is there any way that they would ever be investigated. well you know we've already seen insider trading issues think about it if you had access to everybody's credit card purchases you would know which companies are doing well and which ones aren't would and the stock price implications for that. which is a perhaps a reason why congress has passed rules that don't really prosecute them for insider trading but you know we just have a ton of implications here google for example recently passed recently got a patent where they can engage in price discrimination so you know if they know

that you're from your e-mails that you're going the your grandmother just died and then you're searching for an airplane ticket they know the you're going to be much more sensitive to paying a lot of money for that airplane ticket so they're going to serve you up a different price and if they've got all your google wallet information in your past purchases except they can charge you more for the book than somebody else who may not be willing to pay as much and so that's where i think we're going to really see some encroachments and where it's going to get costly for people who just don't protect their privacy they're going to have to pay more for stuff that they otherwise wouldn't have to pay and that doesn't even get into all of our civil liberties issues with having a government that's got access to all of this data and information in these databases because as you said it's archived database stored it's searchable forever we don't know who's going to be in power in twenty years we don't know how they're going to use that data and information you know you want to find everybody you know

right now it's the it's the obama's i.r.s. going after all of the tea party groups but you know if the if the republicans get in power over remember they're the ones who got all these powers in the first place with bush i mean they might be mad that the that the powers they gave the government of been used to persecute them so there they might go and start persecuting the democrats and then it just. really gets ugly and politics gets even more messy and so it's going to be exciting to see how those of us that take control and protect our privacy and raise a cryptographic shield you know we don't have to rely on that fourth amendment quite as much because it makes it technologically infeasible for them to just be trolling through the data the oftentimes it seems that there is a binary option and a choice between security or freedom you know and we're just out of time but do you just have a quick comment on the. yeah i think that it doesn't have to be that way we don't have to give up our security our freedom in order to have security i think that we

have extremely competent people at the n.s.a. and at the f.b.i. and cia and in law enforcement i think that giving them just these absurd amounts of data you know one in eight it's not very responsible as us as taxpayers because we're paying them to look through stuff that doesn't really help at all but to erode it distracts them they're not focused on the right people the ones that are really out there causing the problem i hate to have to interrupt you trace that we're just out of time thank you so much this is trace mayor he's the owner of how to vanish dot com thanks very and i.

and it's time for the daily deal with bob english thank you it's great to be it's good it's friday it is friday and it's very male day our first comment is from phoenix rose on facebook he said he was just watching the episode about unemployment numbers his question is just how do they know how many people are actively looking for work how is their data collected and what actually is you and . is this a true reflection of how many are unemployed ok well the bureau of labor statistics actually conducts two surveys the first is on the households and the second is on corporations and the first survey on households they go house to house they have standard sampling method and that gives a fairly accurate projection of the unemployment rate so i'm not really sure about that because i took the test and i did very well as a test taker and one thing that we learned about a biased sample and when you're just going house to house i think it. very easy going to buy a sample and who answers the door whose home of a certain hours they may think is very easy to get to and talking about body

samples that's actually the allegation in the corporate survey and the corporate survey is much more controversial it's much more volatile and unfortunately that number gets a lot of play in the present a lot of traders trade off of it because the number itself fluctuates so wildly and it's often revised from month to month and back to his original question well you know we're out of time sorry so if you guys want to continue to leave more comments on facebook you can follow us at facebook dot com slash prime interest and you can follow bob on twitter. and you can follow me at perry and our team bob thanks for joining. us what was to thank you. and it was a pensive day out prime interest we thought the price inflation data looked

a bit hot but apparently the fed wasn't too concerned about it because bernanke he telegraphed to hilson around at a tapering eight the same thing as a raving interest rate if that makes sense to you please do feel free to leave a comment on facebook about it and add another scandalous development and dependent foreclosure appeal to the bum looks like a top bad boy or it's got alvarez got his hands dirty with this one and we're grateful to our big coin buddies trade to dre as for helping us reflect on security issues as they relate to the security state and finally to our viewers thank you for helping us realize what's important to you and we're going to meditate on this week's events make sure to come back on monday from everyone at prime interest i'm perry and boring have a great weekend. when

the president does it it means it's not illegal these are the words of richard nixon brock obama appears to be saying the same defending mass of you with chronic surveillance of citizens all over the world defenders of prism and come with some form and claim these programs protect lives but who is looking after protecting our rights. download the official ati application to yourself choose your language stream

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up on our t.v. the fight in syria appears to have breached a new turning point the white house now claims that syria's government house used chemical weapons against rebels what does this mean going forward find out in just a moment. the people of iran head to the ballot box today and a new successor to president obama dennis shod will be picked between six people with three of them considered serious contenders and more on the selection later on in the show in the nation's capital protesters gather in response to that and after you surveillance we'll take you to the rally that's demanding an end to the u.s. government spying on their own citizens.