half an hour a team so they're trying to shorten and that was one of the ways it's just get rid of jail but you know it also gave away i think the wall street journal how they see the game being played by the players on wall street is that they don't have a have to go to jail so we see that the first headline s.a.c.'s cohen risks lose some fortune while keeping his freedom stephen a cohen founder of a fourteen billion dollar hedge fund indicted and what the u.s. calls an unprecedented insider trading scheme faces a future without a fund or a multibillion dollar fortune on the other hand he won't be behind bars oh yeah oh steve you go in is going you know version of the monopoly board where there is no jail you see steve biko mistake and he's making it real he's doing he's doing it but you know he doesn't want jail steve biko and you know he's got he's re-inventing the game using that stuff but you know there's a gentleman here somewhere go to jail though you know there you go to jail you know

in case you don't get a good view of this is right there you don't go to jail steve you going ok this is no jail me and that's not free market cap continue please well of course the u.s. attorney general in new york says that you know colin himself wasn't charged unlike at least eight former s.h.c. fund managers and analysts who have faced or are facing fraud charges for their roles in a scheme which allegedly involved more than twenty companies and went back as far as nine hundred ninety nine so here they have a classic case of rico they could charge with rico but they're saying here like most of us trading floor we're all engaged in insider trading schemes you know this is like approaching alcopop own and al capone saying i had no idea all the guys working for me were thugs and murderers and running out the hall and drugs and all sorts of other stuff. out there in connecticut it is the rule of law if you're steve you're going out of blood but i was thinking rose what i'd like to be done at all. final piece of land of stink and rolls their way is the monopoly with real

estate portfolio all i need to do is borrow a future line dollars risk closely for free from the federal reserve buy all the stuff then charge everybody read because i'm a rent seeking fool i'm an oligarch i'm jamie done another student who was there for other people up the us version of a noble who suckers well you know it would be a game wouldn't last very long that's a very good way to make a very short is that one of two players only one doesn't have to stop it go to jail. and the other one doesn't get to stop on the two hundred dollars two hundred dollars pass go like the ordinary person never even passes go they don't pascoe because they don't get to collect the two hundred dollars not now let me let me just stop you there first i could because you're making an excellent point the average person does not collect their two hundred dollars i mean yes sure they're on food stamps and i'm just sure they're on benefits of some order or another in

america is becoming an oligarch to see you know kind of rotten old gulag but for the vast majority of wall street bankers they just get this free money they get the money they get the free money that they're given these subsidies from the federal reserve they don't pay any interest on this money that they take they are in fact leeching the system of all the possible financial integrity and they're doing so with the reckless abandon without any rules or kind of inherent to laws whatsoever like stevie cohen of s.t.c. capital is demonstrating they're just free money no laws well in fact monopoly is kind of perpetuating a myth that all of us can participate in the same game board because what it is is yes the average american will collect two hundred dollars a month in food stamps where the likes of stevie cohen or you know jamie diamond or lloyd blankfein or any other banker connected group halliburton halliburton just a. minute to destroying evidence in the deepwater horizon the gulf of

mexico oil spill they admitted to it and all they're having to pay is a two hundred thousand dollars fine avoiding jail not being criminally prosecuted and the other normal person would go directly to jail sit this the next the rest of your life out essential but you know they collect the bankers will collect hundreds of millions two hundred million two hundred billion two hundred trillion in subsidies and bailouts right the average should know gets that two hundred dollar food stamp to go to wal mart to buy some baby formula for their screaming little american to a baby but most of the other bankers are the. where they're getting two hundred billion dollars freebies by just going around the board everyone else is trapped is trapped in these little houses and they're trapped in these little units these little ghettos of american get out of the american ghetto because you know and they give him a little they give the little guys this is going to vegas and roll the dice maybe you'll make a million dollars but you give us fifty thousand dollars an hour because we got here the casino gulag i mean you dropped it right there but there's now

a new special dice because or die a guess because people don't have the attention span these little babies on two hundred dollars worth of food stamps a month they don't have the attention span and stephen participate because why they don't need to participate because they're not going to ever collect the two hundred dollars free money for real now they're just trapped on this board like a hamster board they should make this monopoly for hamsters and that should be a very good selling brother for many of these people but prosecutors against t.v. cohen are charging him on civil fraud charges so money laundering that they commingle the profits with his own so his nine billion dollar fortune is at stake they could possibly seize it all but in so many people from a single hedge fund have engaged in insider trading it is not a coincidence barrayar said today's indictment is not just a narrative of names and numbers it is more broadly an account of a firm with zero tolerance for low returns but seemingly tremendous tolerance for questionable conduct he said so s. a c. over time became

a veritable magnet for market cheaters but you could say that max about the entirety of wall street the entirety of the corporate culture it becomes a magnet for market cheaters whether it's you know in the energy markets and california which are one of the biggest magnets it seems like it's a you know black hole of draws in all the market fraudsters and never stops nobody closes that black hole but the entire system is like well let's talk about cohen's commingling for a second he'll have a pile of money that's given to him through the repo market through the federal reserve you know get some real estate that he acquired through some ill gotten gain some scheme and he's got here in this big fight. and over there is a sea capital and then we'll take a bet with this money and he'll make a bet let's say on the end you know up or down and it put some money on the bet like this if he's right they need to take the money back and says oh that's my money that's my money i made a winner but if it's a losing bad he says oh you lost your money you're a loser oh sorry you're a loser let's make another bet all i'm going to bet that the dow jones is going to

go higher they're up at this moment let's see if it works of dow jones goes i hope that's my money well i made more money or dow jones goes down sorry that was your money that's your bet oh no you keep it you keep the loser oh you keep the loser see it's all of the winners i keep in the micro mailings game the losers you keep all by the way you do to bellow by the government go see the government go see barack obama look at your obamacare go get your obama phone you know take a lot of about i got the winners you get the losers well speaking of you know keeping the winners and getting rid of the losers and the threat of jail here's a headline j.p. morgan to sell commodities business move comes amid regulatory scrutiny of wall street the largest u.s. bank is getting out of the power plant and warehouse business amid heightened regulatory scrutiny of wall street's ownership of such assets so you put go to jail on the monopoly board called the u.s. economy then these guys stop committing fraud jamie shrugged or g.p.

morgan shrugged this is another example in other words they were going to apply the rule of law to jamie diamond and j.p. morgan so why do we said well no i want to be in that business i don't want to be in any business right to adhere to the rule of law if i have to here the rule of law i'm getting out of the business life masters under the bus all that money is mine yes all the risk is yours lol not for me law for you lot not for me oh you can apply the law to me oh i'm going to do my atlas shrugged oh i pretend i'm a free market capitalist i pretend that i'm actually for fair play you know i've been stealing leaching skull that would still the nickel of mine. mother gold teeth out sell for a buck if i could to jamie diamond retrograde moron well you know since two thousand and three since the federal reserve and congress allowed this to happen for banks to get involved in the physical commodities market which they have always been prevented from doing but then they were allowed to get in j.p. morgan spent many many many billions becoming the number one in the world that the top natural gas they control the natural gas market they control number they owned

half of all of the copper in the warehouses in london at one point and j.p. morgan's two thousand and ten purchase of henry bath and sun a metal warehouse in network gave it more than seventy facilities on four continents from new orleans to singapore nearly eleven percent of the industry total and they're staying in the silver and gold market though well they're horizontal integrated is the business term for this in other words they buy up all the possible horizontal warehouses and metal shops that would give them complete total monopoly positions and monopoly pricing and then this was going to be a great way for these scoundrels and financial terrorists on wall street to print more money and then the somebody thought well maybe maybe you know it's against the law to be a monopoly position and manipulate markets so they said no no we'll sell out of that but you say we're going to stay in the silver and gold position well but more importantly let's compare it to the first story about steve cohen because his whole organization is being charged with insider trading the firm is now the reason why

these firms bought up the physical commodities markets why the banks were so interested and spend billions and billions of dollars and all of their effort buying this one of traction was that such businesses allowed banks an early look at information on supply and demand they could profit by seeing the flow of raw materials and trading based on that plus their added knowledge of financial markets i.e. they were insider trading they could see before anybody else the supply and demand the true supply and demand situation now the interesting thing here is that. i mention the california energy marc. it's you know j.p. morgan was just fine over four hundred million dollars for rigging those markets well senator jeff merkley democrat of oregon says every minute of the potential for problems that occurred when enron was both supplying electricity and running electricity trading markets don't all like this like how many times does the same crime have to happen before they say let's stop it let's introduce

a go to jail do not leave for the next three rounds or the next three lifetimes right and just skilling was one of the architects of enron's crimes is going to be let out of jail early presumably he'll get a job at j.p. morgan so there was j.p. morgan's attempt you know to attitude toward commodities is what the n.s.a. kind of approach through data facebook and data they want to control like a huge vacuum all the data all the information to manipulate it knowing the three hundred sixty degree full spectrum dominance of all the data so jamie diamond wants to say oh let's just control every single commodity trade out there in the world take a little piece little rent seeking well the exiting this market now because people you know you have revolutions around the world partly because since two thousand and three all the prices of oil agricultural goods copper metals everything has risen because they've created artificial monopolies and then there were big corporations like millers chorused you know beer beer when the bear manufacturers start complaining those guys you know out in pennsylvania are going to rise up. all

rights next year but thanks so much for being on the kaiser report thank you max stay tuned for the second half a whole lot more. the judge is essential. to build on the streets. that women kidnapped and converted to islam. will be. another hero motos from the culture christians of egypt to the cross to use muslims future victims. the way of the cross. we are facing a lot of problem you know. because no one thought to drink no good school.

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do so now with your mobile device so you can watch on t.v. any time anyway. welcome back to the kaiser report time now to turn to precious metals expert andrew maguire andrew luck and back to the kaiser report max it's always great to be here all right we're talking golf again and i think first i want to just ask you a question see if you agree with this you know people understand what happened back in northern rock when it collapsed there's a run on the bank and people are lined up outside the bank give me my money because there is a panic that because of the risk fractional reserve banking system that everyone's deposits are there at the same time there's a panic they go to the bank isn't this what we're seeing in the gold market isn't there are essentially a run on the london bullion markets association right now absolutely there is and

that's and we've got lots of evidence for that so i mean i think you know you had an excellent interview i know with alison mccleod on saturday which i looked at and i want to say i want to agree with everything he said i think what we try and do is try and keep it really simple as to what all this means i think what we're seeing is essentially. we talked about backwardation and i think a lot of people start to glaze over when we talk about all the technicals but in simple terms what we're seeing now as evidenced in go for rates which have been described by sandy jaitley extra extremely well and people go back and look at your other interviews and look at what exactly that means technically but essentially what it means is the bullion banks right now are having to pay a premium to buy physical now that's unusual i mean we were in in backwardation in gopher rates for the last fifteen days and possibly it's too early to check but probably sixteen that's unprecedented and what it means in reality is that there is

a run on the bank the bullion banks are having to go out and pay a premium to buy bullion now given the fact there's no producer hedging going on of any song use which might explain some of that really what they were saying is they're actually coming out paying a premium buying the buying bullion. to spray vi bullion to the market because there's a shortage of bullion with the two things going on it there's a shortage of blame going on and a lot of drivers to that if phenomenon are happening on the central bank level the big macro level but there's something else going on here which is that what you're saying here technically speaking is that for traders they could sell their spot gold today and essentially buy it back and the three month contract for a locked in arbitrage profit but because they are so uncertain that they could buy it back in the future they're not even willing to pick up the free money that's

being availed to them and what this arbitrage that's backwardation that's completely abnormal that's a telltale sign of a market that's in a stress does does does dress correct that's absolute evidence i mean there's the bottom line i mean why would i in the month of july which working still in july here average about one dollar and sixty cents announce a premium spot which is the cash market in london and i'm not talking about shanghai i'm not talking about vietnam where you can get between six and one hundred dollars premiums announced i'm talking about london the global market the global marketplace for gold so it is a true benchmark i.e. the fix comes up this morning whatever the price is is what i can sell or buy my book in for now why as an arbitrage or why as i have a bank or a hedge fund or somebody in the profit business wouldn't i take and it's up you know up to two dollars and fifteen cents a matter of days ago but an average of a dollar sixty why wouldn't i sell two million ounces today give you money give my

bullion take up to a two million dollar profit and not wait ninety days wait the contracts about to expire i could wait less than thirty days and get my billion back well as you said why not. because there's no confidence that these markets like the comics in a lot of blame marx association are going to survive another thirty days intact as we know them and what i what i'd be worried about is me getting my m i believe i believe we're talking a default here of a century or so that's right we're talking about the long rumored anticipated talked about default on the comics or london berlin markets association but based on market in the action the run on the bank it's either ad and right now or some another extraordinary event is about to take place well it's own now and i think you know his the here's the interesting part on april the first we saw the a.b.m.

default it became public because a client of mine and i think other clients suddenly came onto the onto the marketplace and said come to the press and said whoa hold on a minute i can get my bullion back you've got faith in a system that's been held people have said look you know go to the under bill you mark association i've got two kinds of ways of storing my gold and they steal you into not ok to contract because there's no. you know i will just give you a piece of paper that says you wrote this suddenly we know for years and years and years we've had suspicions about the leverage the one hundred twenty leverage of paper gold all of a sudden a.b.n. amro comes out and actually is the first album a default the very first so right now the timing on this goes back to your your witness your testimony to see have to see about the fact that these markets are are trading at one hundred to one leverage when you want and testified see if you see about the alleged manipulation the silver market it came out in testimony from the

other side almost by accident that mentioned that there was one hundred to one leverage on the l b m a which up until that nobody was really thinking about and then it seems like from their germany one of their gold in amber went into fall you really set in motion a chain reaction and you go are you are the whistleblower extraordinary this space so now what you were imagining was going to happen six months ago a year ago it's all happening right now so i'm starting to reference any oh yeah so really there we have the default now what happens is is that suddenly this fade the b.o.'s the bank of international settlements the central banks of central banks go holy smoke we have a problem we cannot afford to have a billion bank go down if there's a run now immediately you've got one default what's going to happen everyone is going to do you know the wrong thing norden or the wrong thing and one up i want my billion that would cause a lot of the three major bullion banks in london which would collapse the entire global banking system as we bullion bank is there measurably banks are i would

imagine three of the four biggest banks right just b.c. j.p. morgan goldman sachs i mean it's not just the u.s. it's the three biggest billion banks in london in london from both sides and bear in mind there are six billion banks clear the c.l. which is the london clearing bank system which is very serious six billion banks pretty much all of those control what's going on they clear everything in london every day. but basically so you've gotten out of this run so what happens is the fed steps in and says look we rather than expose this whole collapse and an also on top of the whole fear fear of system being in collapse what we'll do is withdraw the provide bullion to the market so borrow it and we're happy to continue to read hypothecate what we've got which is already leverage as you say people are asking for their billion back is already a problem so what they do is they see backwardation they go the only solution that we can see short term is to dump the futures price in other words they provide so

much synthetic supply into the paper markets of the comics paper markets that we drop four hundred dollars well here we go full circle four hundred dollars lower where are we again we're exactly at the point where we were when the a.b.n. amro went down except for the prices four hundred dollars cheaper although we kinds of blown out g.l.d. is already dumped what it's going to dump so where are we now we're in even worse or rather the central banks are even worse situation now because what was on anticipated andrea correct me if i'm wrong but when the price dropped from sixty eight hundred to twelve hundred by dumping paper onto the model market it increased the demand for physical in asia so that and such so they were hoping that a lot of gold have come into the market physical gold by manipulating the paper market because the paper market is the tail that wags the physical market so by dumping in the paper market people are going to sell their physical back end and

there's a lot of media press bull markets over get out done so what happened was the opposite in asia people lining up outside the door to buy physical gold so the central banks who were dumping that gold to fit create that suppressed price are now short gold and now sense they are the physical demand has not gone anywhere but up they then are in a position of having to come back in to satisfy the. physical demand by buying physical again right so it gets back to this point where near and backwardation right it which is it getting worse every day it's got so much worse before we didn't have the go forward offer rates negative in other words it didn't actually cost a premium for the pool and banks at that time to to to to actually lend the bullion so essentially what we've got here it's a way to buy that billion so essentially what we've got here is a worse situation if i liken it to the fact thirteen years ago when gordon brown

bailed out goldman sachs by creating that by dumping all of the british britain's gold up. andrew you've done it again i mean everyone is fainting now it was watching the show especially in the u.k. as they were tall the garden brown saw all britain's gold four hundred ton sixty percent of britain sovereign gold for reasons other than bailing out goldman sachs but it turns out looking through the record in retrospect that in fact that's exactly what he did and vice they've lost i think over a trillion and not trillion but the huge value in appreciation from gold so it's a just review we've got about a minute half left very interesting stuff review gordon brown bailing out goldman sachs by selling britain sovereign gold take it away it's two hundred fifty bucks then where we know it's twelve hundred bucks now thirteen hundred bucks right now so we are back in a position where gold is almost a thousand dollars higher than it was and yet we've got the same problem again so and there's no who willingly sellers because goldman sachs got caught short dumping

paper gold absolutely so then the bank of england bailed him out by giving the bell and now we find out for miles the mcleod was on ty's report just recently saying that bank of england is thirteen hundred tons have gone missing and you're saying if i connect all the dots year that was sold into the market to take care of these other bullion banks including goldman doing the exact same thing all over again dumping paper money hope. that they would get people did scare out of the goal but instead they they did the opposite they were physical gold on the bank of england it has a liability here a huge liability correct on these billion banks they're going to be insolvent yes or no yes or no and the bank of england has to step in on a daily basis fixes and make up any shortfall out of the six hundred tons of gold cleared by the o.p.m. c.l. every day and the five thousand tonnes of silver incredible amounts but that's what trades through the l b m a every day they step in when people actually have the audacity to offer their physical this discount the bank availing has to england has

to step in and provide that bullion on a short term basis and when the bank of england and the treasury and george osborne when they failed to match the books at the end of the day and there's left over doesn't that just get through the securitas nature of these inciting deal doesn't just end up on the debt of the u.k. absolutely and they're going to stroke an electronic check and they're going to pay everyone off and anyone that hasn't got a physical the reason i don't offer trudging is the day that you get settled in cash will be the day gaps up one hundred two hundred three hundred all this. thought right enterovirus thanks so much for being on the kaiser reports always a pleasure. and that's going to do it for this edition of the kaiser report with me max kaiser and stacy herbert i'd like to thank our guest andrew maguire if you like just get in touch tweet us at kaiser report until next time ask after saying bye oh .

there's a media leave though so we leave the. other motions to. your party visible . shoes that no one is asking with the guests they deserve answers from. politics only on our team. choose your language kelly pickler though if. someone. chooses to use the consensus he could. choose to go to the ins that immigrate to. choose the stories that impacts the life choose the access to off. the main competitor on the market is mother nature. may customers

struggle with good. fight for each drop from an old dirty supply. let people think i are prices pure want to. live on our teeth. they use it up there and wash their hands in it and flush their toilets with the same water that mystery's is selling and spraying water. little bit lippold. clinton. good speech. if you.

wish. to bomb it so good. luck. just see. it and. come out of my mind i'm a little. live.

live. live live. live . right. first for you and i think the true. foreigners.

this is any minute now this bradley manning is set to discover whether lifting the lid off america's military role will see him spend the rest of his days behind bars . recovering israeli and palestinian diplomats meet in washington to revive negotiations after years of failed peace efforts while in the palestinian city of hebron we report from where the roots of the deadlock are keenly felt. this full cost of a chinese slowdown cast a shadow over the global economic outlook we ask whether the numbers of back up the pessimism.