since the financial crisis it's no secret that foreclosures are up eight million dollars in total and that's buyers oftentimes with cold hard cash swooping in to catch them all up now enter the sleepy suburb of dayton ohio name hubert heights huber heights now a nine billion dollar hedge fund called magnetar capital has purchased nearly one in eleven homes there now the management company has filed to reduce property taxes on one thousand two hundred eighteen residences by about fifty percent a move that has some residents crying foul and it wouldn't be the first time that magnetometer had come under scrutiny now j.p. morgan was fined one hundred fifty three million dollars by the f.c.c. for selling a portfolio of securitized mortgages which magnetar helped to create and according to allegations was designed to fail now this is very similar to what billionaire

john paulson accomplished the paulson short with the help of goldman sachs now here's what senator carl levin had to say about these types of deals. how about the fact that you showed hundreds of millions of that deal after your people knew it was a bother you would owe you shoulda customers something i don't recall showing hundreds of millions of that deal after that. now joining me to discuss as always bob and wish now bob a lower hello hello this is about the ethics and the work that i do every time you do it now first and foremost is it fair to compare the tarp to the more famous paulson paulson fund and ethically what are the implications behind you know basically betting on something that you helped designed to fail i mean it's a simple ethical question but you're at the wall street we can get into a long discussion you're right yes i think the deal is. so was very similar between

magnet or impulse and it was rather brilliant you can buy something and participate in the revenue stream of it while at the same time if it's bad enough when the entire market turns down it's going to be the first to fail and then you can collect on the insurance contracts so it's a nice way to make money paulson made a billion dollars looks like magnetar made a sizable chunk now is that at the cole well guess what the broker or the underwriter who's packaging this stuff together and selling it to somebody else doesn't necessarily have a few do sciri duty to that other counterparty you know the person who's buying it could be a pension fund could be a hedge fund but they do have to disclose certain things ok in the case of paulson goldman sachs did not do that in the case of magna target looks like j.p. morgan didn't do that at least according to the i.c.c. but the funds themselves were they were they were abiding by the strict letter of the law at least according to the law so is it ethical that's another consideration but you know if you're a pension fund and you were buying these c.d.o. maybe you should just get fired in the first but. now let's get back to him for

heights and magna charta capital is it wrong for a management company to ask for tax cuts because frankly that doesn't seem like something that's all that ethically grey it seems like a fair thing for a management company to do what my understanding is it's the first thing a lot of these management companies do and while the company itself because it owns one in eleven homes as you said probably has a considerable considerable amount of clout is it unethical to ask for this and use its a little bit of muscle to get it through it's common in the industry i think is your understanding as well right now we mentioned some of the largest players are private equity firms and in fact blackstone group is the very largest was some seven point five billion invested in forty thousand properties but blackstone's real estate portfolio has generated needs only need usually returns and recently stephen schwarzman chief executive of blackstone group said quote. we're increasingly taking opportunities to exit investments bob is this

a sign of big money is getting out of housing altogether and yet again i think look blackstone is big money and yes they're getting out when we're talking about measly returns we're still talking about positive returns maybe four or five percent since two thousand and five so it's not such a bad deal a lot of funds who are betting on other things lost a bunch of money during the financial crisis but when you compare it to blacks tones outsized returns of say thirty seven percent per year it's really a comparatively a pretty good deal and as to you know the general market implications yes i.p.o. strength the number of i.p.o.'s that are coming out can be an overall strength of markets but at the same time when they gets kind of ludicrous shall we say stupid yes that can be a sign of a market top so we have to we have a graph here and this goes all the way back to the mid ninety's in the tech bubble we can see the number of u.s. i.p.o.'s to the left in the tech bubble they were just teeming and then there was a drop after that bubble crash and then we had a housing bubble and associated burst in i.p.o.'s which peaked right at the very

end of that and now we can see in this latest environment in the so-called recovery we don't have nearly as many i.p.o.'s in large part that's because compliance costs are so great now we have sarbanes oxley we have dodd frank we have all this other stuff that is just not economical for these small and medium sized companies to go to the capital markets at least in the public sense and become a publicly traded company so i think that could be a sign of the top tier i mean and when you look at that wow compared like the. i.p.o. bubble that was the tech bubble it's it makes the housing bubble look measly if you well yes in terms of how ludicrous some of these prospectuses were i remember reading a few of them they literally said we have no business plan we have a dot com in our name so give us money and that's what happened but a lot of investors lost out because of the incredible stuff that's thank you. as always and we'll be tracking this and much more keeping you posted on all the latest so make sure you tune back in to beyond us to find out everything on housing

blackstone etc. earlier i spoke with michael maloney founder of gold silver dot com he recently created a video series the hidden secrets of money and he did this to explain monetary history well cycles and the financial crisis well the debt ceiling might have been temporarily raised but it's an issue that's guaranteed to be revisited in just a few short months so i first asked him about the very relevance of the debt ceiling and here's what he said. well it isn't relevant because we live in a world that is a debt based monetary system and when you when your currency supply is all owed back plus interest and the currency to pay the interest does not exist yet it means

that you always have to go deeper in debt the debt ceiling is an absurd notion in a monetary system that's debt based and could you explain on the relevance of this we actually have a clip from your video and this is the latest installment that came out and it has to do with and it gives a great visual representation of the debt and currency side by side here it is. we don't go deeper into debt every year look what happens the whole thing goes into a deflationary collapse under the weight of those. can you comment on this deflationary collapse why and what are the mechanics of it how does it actually happen well this is the problem with the debt based monetary system as long as you take on more debt then you've got growth and you've got slightly positive inflation and the whole thing works but the problem is that the powers that be the federal reserve other central banks they think that they can control this mechanism but

it's really controlled by how the public feels if the public gets scared and stops going deeper into debt borrowing and spending all of the time then this whole thing goes into reverse it goes into a deflationary collapse because the payments that you have to make on your car on your home and the payments that the public has to make through taxation to pay off the bonds that the treasury issues to the federal reserve and to other entities those payments don't stop and so if you stop borrowing new currency into existence to replace the old. currency that you're using to pay off the debt the whole thing goes into a deflationary collapse because in a debt based monetary system when you take a unit of currency and you pay a unit of debt in iowa each other on the on the balance sheet on the books and so that currency vanishes along with the debt and so if the public doesn't always

borrow more to cover the in principal plus the interest that's both on the currency supply then the whole thing goes into a deflationary collapse and that's something that we certainly saw in two thousand and eight it wasn't the situation then wasn't necessarily as dire as certain people predicted what are you seeing for the future in terms of another deflationary collapse will be preceded by price inflation how does this cycle works and to your of world view at this point well actually it is as dire as some people as some of the people that predicted the worst. that is actually happening if you look at some of the credit aggregates right now they are collapsing and the federal reserve is offsetting the collapse of those credit aggregates of the money supply. with the creation of base money that that base money doesn't all circulate a lot of it just sits on the balance sheets of the banks because the federal

reserve pays them interest to keep it there. so. the thing that people don't realize is the scale of the emergency that we are still in the admission a month or so ago that the federal reserve cannot taper was an admission that the markets that the entire country is addicted to this currency creation and this scale of this emergency is mind boggling they are creating about a trillion dollars every year and they call it asset purchases by the way and an asset period when they purchase an asset with a check for nothing when they're counterfeiting to purchase an asset and. it's a private corporation purchasing an asset that is immoral that the federal reserve is able to go up and buy up our national debt and buy up a bunch of real estate with mortgage backed securities and counterfeits to do it and then we're on the hook to pay the tab with future taxation but. this

the emergency that were in you know it took two hundred years to go from no dollars in existence to zero point eight trillion dollars of base money and that's what existed in two thousand and eight before the crisis now we print one trillion every year or in other words about two hundred thirty years worth of currency creation every single year just to keep the markets afloat and to keep the economy afloat if they stop the whole thing collapses. the eighty five billion dollars a month the fed is pumping into the economy is no trivial amount and coming up i asked mike maloney about his prediction for the next economic collapse. also we talk about real estate i.p.o.'s earlier as a way to measure our market tops but what about i.p.o. in a football player coming up if you're a fantasy football fanatic this might just be an offering you can't work in.

technology innovation all the developments from around russia we. covered. one of the wonderful sean marginalize the hall of fame. a pleasure to have you with.

more news today violence is once again flared up. these are the images the world has been seeing from the streets of canada. the giant corporations are today. what a tangled web the treasury and fed do we it's a symbiotic relationship whereby the fed now purchases over half of new treasury debt issuance and the interest the treasury pays is recycled back to the fed after of course takes a cut but exactly how do the big banks profit from this arrangement i asked michael maloney about just that and here's what he said. when the these big banks these

primary dealers show up at the treasury auctions and buy a piece of our national debt the debt that the public has to pay off through future taxation and then the federal reserve whips up a bunch of currency from nothing and buys that from the banks and the banks get to make a profit every time that they sell one of these bonds to the federal reserve they're making a profit so there's profit there there's profit on the excess reserves that they're getting paid interest on now and this is something brand new as of the crisis of two thousand and eight the interest paid on their excess reserves and then they're getting a six per cent dividend on their stock that they own in the federal reserve because these banks are the owners of the fed reserve so they have a profit stream from three different ways from the federal reserve to these big banks that own the federal reserve and wouldn't you love to own your regulator wouldn't you love to own the police in your town yes i'd love to engage in

transaction with an entity aka the federal reserve whose mandate is to buy high and sell low i'd like to talk to you know about the future of the u.s. dollar since we're talking about the way the fed supports it we hit the debt ceiling it's been raised can the u.s. dollar remain the global reserve currency. absolutely not and this really started long before it started with. the crisis of two thousand and eight started with the all of the emergency currency creation and the and the spending that the bush administration actually started and then the obama administration just put it into hyper drive and it even started earlier than that when saddam hussein started selling oil for a year of those they did these were some of the first nails in the global dollar standards cough and all countries used to need the u.s. dollar to do debt settlement if

a car dealer in mexico sold mercedes wanted to pay mercedes they converted pesos into dollars wire transfer the dollars to mercedes benz him or say these bands would then convert that into your us well there's all of these bilateral trade agreements being made between countries all the time just recently singapore has now reached a deal with china to bypass the us dollar and so it's just it's every single month and sometimes every week there's a new nail in the coffin for the global dollar standard so what is the timeframe that you might be predicting for the loss of the dollar as a global reserve currency here well i have been saying for many years and i wrote this in my book that before the end of this decade that we're in right now so before the year two thousand and twenty we are going to have a dollar crisis this is going to lead to a global currency crisis because the dollar is the majority of the world's current

value of all the world's currency it's more than half the value of all the world's currency and if there is a dollar crisis i believe that people in other countries are going to look at their own currencies and say oh my god this is just a piece of paper with numbers on it also and people will lose trust in feel currencies now to me actually the worst thing that could happen is that we go back to some sort of gold standard a gold standard is a national. that's supposedly backed by gold and it gives it opens the door for the whole scam to start again based on your two thousand and twenty deadline i know there are a lot of people who have been who have gone broke trying to predict that till risk are we safe for another six and a half years or is this just a loose guideline or timeline that you provided that's very loose i mean this could be happening by next year and one of the problems with this type of thing is you know when you look at currency crises around the planet throughout history is in

a lot of instances it goes very very slow until the day that it doesn't and in many instances you wake up in the morning and your world is changed in mexico all dollar denominated bank accounts were frozen and converted into pesos overnight and then they devalued the peso so you woke up with seventy percent of your wealth gone the next morning. this time after time throughout history you see this thing where it's very very slow and then suddenly wham. and then just like that that was mike maloney of gold silver dot com creator of the hidden secrets of money video series now let's get to today's big deal.

it's football season and of gambling lines cable t.v. fantasy leagues and in person attendance have all become a bore to the avid football fans out there fear not thanks to wall street you can now buy a stake in your favorite player yeah that's right van tech's holding announced a new trading exchange for investors looking to buy and sell interest in professional athletes now the company plans to create stock tied to professional athletes financial performance and its initial i.p.o. is with the houston texans running back aaron foster who we should mention is currently on injured reserve now investors will receive stock linked to mr foster's future earnings which include the value of his playing contracts corporate indorsements and appearance theory fees now investors can place orders for the i.p.o. which is offering one point six million shares at ten dollars a share or attempting six million dollars worth of stock if the demand is insufficient however the company may cancel the deal now right off the bat yes do you think that demand will be sufficient enough or that found actually end up

canceling this. i.p.o. it depends on what the market is doing in general this is this is a very speculative offering just as it says in the offering documents in the prospectus that the company had to file with the f.c.c. so if for instance bernanke he began to taper and the entire market tanked this kind of speculative offering is the first kind of deal that is not going to get sold or if it's sold it's going to have a difficult time trading on the market at its initial price or above that now this offering is obviously intended to capitalize on the man. of popularity of fantasy football which we all know about and it's important to remember that fantasy football is just that it's an a c it isn't real so obviously real to the people in the office. even the office well i mean the fantasy football we see this over grapes and there are going to say. the question is you know this is real money this isn't fantasy what a risk you know everybody it's money some of you know. what is the stock market

money come from you know this is real body and your question is sorry i interrupted you know the question be you know what is the chances of this new platform actually succeeding given that it is real money that you're working with and while fantasy football is fun getting real well there are a couple of things to mention here yes this is the first of several offerings this reminds me of kind of an e.t.f. structure because for instance in the gold e.t.f. you're not really buying gold per se in a lot of these e.t.f. now they might be backed with gold they might be back with a swap of gold swap with an entity that is just a financial transaction but here you're not really participating directly in the athletic in the athletes revenues or his income stream it's removed a bit and you don't have a priority claim on that athletes. if you happens to go bankrupt for instance right which is another big and also like you said you know it reminds you of one exchange now in helping you know there's a hollywood stock exchange of allows people to counterfeit to gerald runs this so

it's not the first time something of this nature is done been done but it allows you to bet on future earnings for movies on the stars in those movies and well this is also done with real money play money kind of like fantasy football and you know it begs the question what makes these these new exchanges more risky than established exchanges other than the fact that they're new and have been tested well first when you say. you know there's a technical term for the term exchange where we think of the new york stock exchange and this is kind of a platform why market. place if you will is it any riskier than some other. investments that have come out we were just talking about the i.p.o. boom of the late ninety's when companies were literally saying we have no business plan this seems like these guys have a business plan but again it's predicated on a market which is already going up and so i think really that has to continue in order for these kinds of speculative risky investments to continue trading at multiples of what have it or is there based on which i still have yet to go away to carouse and maybe that's the plan you aren't supposed to be able to grasp now

pentax c.e.o. bucks friends he said that he did his due diligence on the auster and that he has substantial amounts of cash liquidity and no debt so foster carries a debt to us it is debt to asset ratio of zip zilch nada no zero and you know this isn't i seem to investors for a variety of reasons but why would it be enticing turn vespers and football player . ok like i said before if the person goes bankrupt he's going to forfeit his or his income streams to some entity who knows who's going to buy up that claim but you know what you can you buy a swath. so you don't don't start giving ideas to wall street who want to total return swap on the entire n.f.l. that's the only way to go but to get back to your original question you know football players in particular have a very surprisingly high bankruptcy rate coming out of the league and that's because a lot of them are in there for a short period of time there did their overnight millionaires three probably spend

beyond their means they don't necessarily have the best of people guiding them but you know not to say anything about this particular football player but as a whole football players do not do that well when it comes to exiting the league and statistically i believe sports illustrated just put out put out some numbers that seventy eight percent of football players within five years of retirement go bankrupt. literally i mean what happens if you're in foster who's on injured reserve currently you know and upper tiring well if you manages to keep his own brand viable and he's able to do endorsements with. whatever company used to reach those ninety's who was just throwing those names out there but if he's able to do that he can he can establish himself for a long period of time and the people in this investment can realize a return on their equity but again that's all it is is equity it's you don't have a priority claim to anything that he has a particular way and you're not buying them as jet and. now the as one reveals of the perspective in that perspective investors are actually buying a stake in fan techs brokerage services like you mentioned before

a twelve month old start up mind you that seeking to convert n.f.l. player contracts and earning streams into tradeable marketplace into a tradable marketplace now noted mr foster like you said he owes you nothing found texas first and foremost a marketing and branding and hits big company so do you think this trading platform platform is nothing more than a gimmick kind of like. going to let all live there you go there you know it is a kind of like purchasing a star you know it's. maybe the p.r. generated by this will become so fulfilling that it will actually feed into the future earnings stream that this player has and maybe i could take out. all the critics of on a person there you go you know what actually that's popular now people are are this crowdfunding platform of letting entrepreneurs sell stakes in that as well as i can do the pulse intrude on a football player. and self-importance when it comes to crowdfunding your own self that's that's fine with you. it is what it is well there you have it that's all for

now but you can see all segments featured in today's show at you tube at you tube dot com slash boom bust archie we also love hearing from you so please check out our facebook page at facebook dot com slash boom bust archie from all of us here at boom bust thanks for watching mostly tomorrow. i am the president and i think a society that case i'm big corporation trying to convince to consume it can do. to the bank trying to get all that all about money and i'm the vasily pick for

a politician writing the laws and regulations tax bankers on the head. there is just too much rat today's society. that. the suspect. totally. did you know the price is the only industry specifically mention in the constitution and. that's because a free and open press is critical to our democracy shred albus. role. in fact the single biggest threat facing our nation today is the corporate takeover of our government and across several we've been hijacked why a handful of transnational corporations will profit by destroying what our founding fathers one school i'm tom are going to get on this show we reveal the big picture of what's actually going on in the world we go beyond identifying the problem trucks and rational debate and

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