today's. top. hello there are happy friday i marinated this is boom bust and these are the stories that we're tracking for you today first up but we're bringing you all the latest from davos our katie pilbeam is in switzerland covering the global economic summit there and she's bringing us the lowdown from the swiss alps you won't want to miss it so stay tuned then a little paramour editor at alternative and full founder of recession wired dot com joins me live from our new york studio to discuss the ever elusive american dream ever elusive and it's friday which means it's your day here on boom bust and harrison and i address viewer feedback your thoughts comments concerns whatever live on air today it's all on boom bust and it all starts right now.

we talked today shall we take that full guest appearance from artie's katie pilbeam host of venture capital now katie is coming to us from the world economic forum in davos switzerland katie can you give us a general overview and a wrap up from dagoes this year. it's been a packed agenda that's for sure and it's really been the who's who are the fire got the biggest names in global business the biggest politicians all here to drum out how to solve the world another official is actually shaping the world economy and terms of politics society and business the reshaping of the world and

the themes always pretty funny because everyone always looks around scratching their heads and what is this team all about but i think from my interpretation of it it's just half a decade on from the financial crisis what kind of a an economy are we left with so i can tell you that the issues that were drummed out were of course unemployment stagnant growth surveillance was on the agenda as well global policy is including climate change but i just want to talk about income inequality because that was the biggest thing i've got to say override it all of the other themes and actually coming out this week we have those. numbers that were filled but eighty five of the world's richest people have the same amount of well as hoth of the poorest population three point five billion and i can tell you everybody was chatting about that one here in davos they were saying well what does it mean does it mean so should arm rest what does it mean the youth unemployment and you know it's pretty funny extremely ironic because you've got eighty

billionaires here in devil's talking about income inequality bizarre that's incredible now i want to ask you on the subject of income inequality do you think that we're going to see any measurable amount of change come out of this year's job or economic world summit or that it's more just chatter what do you say that but the thing devil's gets a lot of chris is criticism for the fact that it is a lot of chatter a bit of champagne about a phone call to they say that they set the agenda but we know that we've devils no policies. and really. is that everything happens behind. close doors once david cameron is up on those skis chatting with the likes of jamie diamond that's when all the really interesting stuff comes so i would actually say no however i want to mention the fact that we had quite a breakthrough this wait because has son rouhani the leader of iran he made an appearance the most anticipated appearance of the wait that's a big deal considering it's the first time in ten years that an iranian leader has

come here why did he come well he wanted money he's drumming up investment we know the six month interim deal that was cracked out last year it's now in action and what that means is he was appealing to an audience of the likes of to tell any b.p. exxon mobile and he was saying to them look we are ready to engage those were his words and we know that he is considering the recession declined five percent last year he's got a seventy five million people population to contend with so i say that that was a pretty big deal this week actually mr rouhani turning up now i want to ask you what were some of the most surprised i mean that was surprising there were some of the other most surprising events to take place during this year's forum. well there's always surprises and i think one of the eyewitness myself was the lead singer of u two up on the stage with david cameron because he's always extremely critical of the british government and their policies and i was really interested

to what he had to say because let me just rewind to old memories because back in two thousand and six he described davos quite famously as fact cats in the snow i now today he was actually quite complimentary a more he said because he praised the fact that tax evasion is being dealt with but he also recognized the fact that it is the biggest instigator for world poverty so i'd say just the very fact that i saw born i was quite exciting and quite extraordinary as well but actually one of the things that did concern me i want to mention as well is some of the comments that came out from the japanese leader he was praised for what you did with bringing the economy back after two decades of stagnation but he has some quite scary things to say about politics in asia because he was saying that the wall needs to wake up to what's happening in china. action he was saying that because they've had a few disputes with territories now one final question for you kind of

a funny one was there a lot of skiing going on you mentioned jamie dimon and cameron on the slopes that's where the real business gets done but was that was there a lot of skin merkel out and actually. you know many attending is hitting the slopes or doing more or pray what was it. you know i didn't see any skiing myself but i've heard through the grapevine through the gossip girls going to the the coffee machine that apparently there was a lot of skiing going gold bar it was actually the celebs that were doing it and not the doubles apparently because we've got the likes of goldie hawn. we've also got matt damon apparently they were doing a sport of skiing and why no i mean they're here they might as well live in joy themselves but yeah it's always a bit of skiing and i think tomorrow is going to be the ski day for everybody in the champagne and you know there's been some extraordinary paul it is as well like really extortion money must have been spent on these parties i can tell you that

much for free and you know what this has been quite interesting because it's not just about the health of the economy but the health of us because every morning before the seven hours of kicked off there's been meditation which is kind of kind of ruined by growing on her katie thank you so much for your time and that was our to venture capital as well being reporting live from davos switzerland whatever earlier today if you will. business and political leaders are still in davos today and one of the main themes there is income inequality now yesterday we spoke with anthony randolph of the reason foundation about the wealth and income gap now today we take a look again at the american dream in income inequality with lynn pare more dr

paramore is senior editor at alter net and co-founder of recession wire and founding editor of new deal two point zero that's a lot to be founding founder of she writes exactly about these very issues though now when it was a pleasure out of it it is a pleasure having you on the show today and i want to start off with my very first question it's been fifty years since president johnson you know launched his war against poverty has that been a success. in some measures it has been a success in other measures we really still have a long way to go there was an interesting study that came out just this week by some harvard researchers and another researcher from berkeley and they determined that. social mobility has not changed much in the last three decades or so and some people are taking a lesson from that that we fix everything and we don't have anything to worry about but i find that a more worrisome trend because with the things that have happened in the last few

decades like more women in the workforce less discrimination against minorities more people going to college it seems that we should have seen social mobility going up so why haven't we seen that and the authors of this study have named several factors that really help people to get themselves out of poverty in this country and unfortunately one of their findings is that it helps to be born in the right place there's sort of a birth lottery that goes on in america and if you're born in san francisco or new york or boston you have a pretty good chance at getting ahead economically and pulling yourself up by your bootstraps but on the other hand if you're born in charlotte or atlanta you don't have a very good chance of pulling ahead so it's really a tale of two americas. that's my take away from some of this recent research when you're reading my mind and i thank you for bringing that up i actually came across that article last night and has quite a misleading headline kind of saying that there is no longer

a poverty and poverty issue but do you think that social mobility here in the u.s. shows that everyone has a fair chance i know this article like you said it's not all if you have a better shot at a fair chance of your from san fran or you know other coastal cities but does this does this show that more people have a fair chance. i don't think it shows that more people have a fair chance i think it shows that when you look at people moving from one economic wrong on the latter to another things have been stagnant for the last few decades and i think there are some areas of the country again where people are able to get ahead more readily and other places where they aren't and the authors of that study and it was a quite an impressive group of researchers they found that several factors are determine it in your chances of getting ahead and geography has a lot to do with it whether you were raised in a home with two parents or a single parent seems to be a factor whether you had access to good schools good primary schools is

a big factor in communities where there is less segregation both by race and by economic factors also is an indicator of whether people are going to get ahead or not i grew up in raleigh north carolina in the southeast which is a section of the country that the researchers have found is not very amenable to social mobility people that are born poor there tend to stay poor and it also happens to be a very segregated society i was fortunate enough to go to a school system a public school system in raleigh in wake county that had worked very hard in the last several decades to desegregate both in terms of race and economic status but there is a real movement right now among some of the more conservative members of the republican party in north carolina to change that there is what they call a neighborhood schools movement which parents you know some parents think sounds like a good idea but if you look at this research on what creates

a community where people have a chance to lift themselves out of poverty and move up the economic ladder you want more diversity in the schools you want people from different income levels going to school together so that's something to think about when i want to move on here now under the obama administration we. we've seen huge gains for corporate profits for stock prices and for home prices and houses are the main assets for many many families still yet the gap between the rich and the poor it's been increasing apparently ninety five percent of income games from two thousand and two thousand and twelve went to the top one percent only about one percent what do you think is going on here. i think a lot of things are going on here i think one of the factors is that the rich in this country don't really pay their fair share in taxes we have issues with corporate governance i think that contribute to income inequality and really don't

allow workers to get ahead even though there are investing a lot of sweat into companies that are succeeding i'll give you an example which i've written about lately and that's apple a lot of people really love the company it certainly has made fantastic products that make our lives better but instead of taking the enormous pile of cash that it's sitting on and raising the wages of its workers which you know if they're retail workers they're not very high at all they are doing things like manipulating stock prices in order to do stock buybacks which tend to enrich executives so the executives at the company both through things like stock buybacks and sky high executive compensation there's such an enormous gulf between them and the people who are working and investing their energy and time and talent into making the company a success you know so that's another trend that's really disturbing no quick question we only have a couple seconds left but what do you make of all this talk about raising the minimum wage. i think it's

a great idea and i think it's really long overdue the peace that you shouldn't work you know eight ten twelve fourteen hours a day and end up in poverty there's just it i think the arguments that people are using that say that it's going to somehow impact economic growth in a negative way is just nonsense raising the minimum wage puts workers money in the pockets of workers that allows them to spend that money in the economy it increases aggregate demand and it's an overall boost to the economy it's a really long overdue and if they can't get it done at the federal level fortunately the states and the cities are are working on raising that wage it's right lens out we were out of time but you have some great points and we love to have you back on the show very soon thank you so much that was dr lynn paramour co-founder of recession wired dot com and founding editor of new deal two point zero. great. time now for a quick break but when we come back we've got the best clips from this past week

then ed and i tackle your viewer feedback you won't want to miss it stick around it's all coming up. a side. i think corporations mind. because. i'm right. all the money and i'm actually sick for politicians like the laws are. just too.

you know. pleasure to have you with us here on our t.v. today i roll researcher. now the big theme this past week here on broom bus addressed by all of our guests was debt and how the fed has tried to deal with the problems associated with debt in turn creating new problems take a look. now one thing that's been said about here is that it's just

a form of trickle down economics the banks get the money and prosperity it's supposed to supposed to trickle down to everyone else do you agree with this well you know it's not going to work i don't like maybe calling it trickle down government or something like that or trickle down inflation somehow if we create a lot of inflation and let wall street financier is get rich that it's going to benefit everybody else it's not what we need is legitimate capitalism we need real wealth creation we need increased production but we need good paying jobs that might come from a vibrant economy you don't get that when you just have cheap money sloshing around the banks you have some people getting rich based on this but it's basically at the expense of the broader economy and it prevents legitimate economic growth from taking place this focus is debt and specifically how high many minsky's financial instability hypothesis is reflected in a highly indebted economy is now right now dr king is working on an ambitious

mathematical model of financial instability simply called now i spoke with steve earlier this week and asked him whether his principal concern right now was private debt take a look. well that's really the main driver of the economy and this is the amazing thing that economists tend to believe that any profit it does is good anything about profits that it does does it's bad if a private think it is good in public that it is bad the ironic thing is normally conventional people meant that was wrong this is absolutely wrong because in many ways it is easier to handle than profit for the simple reason that a person isn't a profit person. to get out of trouble but to a large degree public sectors that aren't it can print their own banknotes expect those to get out of trouble so it's actually the profit did in supposed to cross use and when you see ranching public there's nobody because of collapse. in the

little profit ship to fund its expenditure specifically because the profit it will stop borrowing money much precisely what caused this crisis and because of the big moment it shouldn't be noted if i was the cause of the disease was suffering from now so what you have around the world is economists on. countries to treat the symptom which is public rather than the cause which is a collapse in the road of growth of profit now australian professor steve keen argues that mean stream economics doesn't take money banks or debt seriously enough when modeling the economy do you agree with them. i do completely agree with the dominant economic orthodoxy which is taught in all of our universities to the exclusion of other economic theories and thinks of money as a commodity thinks of it as something that can be scarce and something that can be managed by said the forces of supply and demand but because money in the. advanced

western economy economies. originate as credit in the banking system. it is far from being a commodity it is actually a system built on a social construct. if you like on social relationships based on trust. and as such it can be created if you like out of thin air so these two very divergent views of what money is have informed economics but the dominant view is that money is like a commodity like gold or silver or copper and as such it's in limited supply you have to build up savings before you can you can spend under that basically under those theories whereas under the case he and theory came to an understanding of money which is actually goes back to jordan or. back to you know sixteen ninety four when the bank of england was. the banking system can create credit which can

in turn initiate economic activity which can generate income to repay the debt and if that system is stable so to speak then the creation of credit is entirely a good thing for economic activity if it's allowed to be wasted. on a speculative activity then that system big. falls into deceptively and if you like the gap between the rich and the poor it's grown here i have the numbers here ninety five percent of income gains from two thousand and two thousand and twelve went to the top one percent there you go now does this suggest reject redistribution upwards and downwards crony capitalism or the lot of the current capitalism comes from quantitative easing which has as bernanke has him self admitted pumped up the stock market driven up equities the top ten percent of

america's really would own as well from the stock markets which is going to drive up a lot of wealth for the top one percent in general so under the obama administration has been the entire quantitative easing program started in two thousand and nine so it makes perfect sense that that's where a lot of wealth is going to go up because it's kind of redistributing our surprise is that when you say you know redistributing wealth by increasing our surprise i mean their incomes if you're talking about income inequality where money is going from the poor to the rich as opposed to just the rich gaining faster than the poor those are two different kinds of income inequality we've got a lot more people on welfare under the obama administration and a lot more wealthy people out of the bubble as a result of quantitative easing whether or not that money is being redistributed from the poor pushing them on welfare or not is that i doubt that's really what's happening it's a lot more the fed's printing money we've got an asset bubble right now the stock market is going to blow up at some point probably not the next couple months well

the plans of how the tapering works but in terms of wealth for the upper class it's grown not necessarily distributed from the poor. that was peter ship steve king and how to for an anthony rand with their takes on debt and income inequality all from this past week now it's time for in the margins where we hear from you. it's in the margin time with harrison always good to have you and have you around this part now edward joins me and this is our weekly wrap segment it's built solely on viewer feedback and now all of this week's feedback comes directly from boom bust you tube page your turn to sound off so let's get right to it now our first remark comes from why i am camorra for twenty interesting i like it now he wrote if

with regards to last friday's episode featuring peter schiff here's what he had to say quote peter shift an investment manager who predicted the two thousand and crysis wrong peter is like a broken clock he says right twice a day he predicted a crash every year and then one year it happens he thinks he's mr damas according to this silly person on say blank blank we were supposed to have hyperinflation in two thousand and eight nine ten eleven twelve and thirteen austerity was going to save europe and the bond bubble was going to pop gold was supposed to be at five thousand and i could keep going people missed out on one of the biggest market rallies in the history of american of america listening to this clown strong words strong strong words now do you think this viewer may have been burned by some tips of. one future shift and that's what this is or there's some validity to his performance. but i think he's pointed out that a lot of people they don't like. was right. for it's

a crisis but they don't believe that he got the economic paradigm right. they feel that he was out of paradigm in that what actually happened and the specifics of what happened went very counter to what he was saying and i think it goes to the whole inflation deflation debate that a lot of people basically what's happened is we've had inflationary scenario with credit inflating over the past years and that's created an asset bubble as a result of that we saw deflation in asset prices which led to you know deflation in the general economy or disinflation at a minimum and so he got it wrong we got on our next comment this comes from the n n g in response to my interview with and had a four on tuesday guinn writes if the borrowers don't have to pay back the money they borrowed the money they don't have it will be a major moral hazard everyone even the most stupid will rush to do you just that to borrow as much money as one can so wonderful world question mark why bother to work

and i kind of truncated not not quite right there but what do you think about this one out of debt debt forgiveness you know it's happened before is it a bad idea to have it happen again. you know the whole same theory of contracts when i when i read that i think about the sanctity of contracts and the fact that there's a mismatch between what the borrower has under contract to obligation and what the lender is basically you know you can't break the contract but the the lender has already lent the money and they've actually invented the money as a pedophile would say you know really the print the money out of thin air and then use the borrower to meet your contractual obligation we've met ours and so ultimately when that loan goes back you know all of the you know the burden falls on to the borrower so how do you deal with that if it's a systemic issue and i think it's the exact same issues you get into with bailouts as well in terms of systemically important lenders who need to be built do you

bill out the borrower and what kind of moral hazard is a present. exactly distractable well our final comment comes from wednesday's show featuring steve king who spoke about private debt the australian economy and to coin now cold war warriors wrote in saying quote the australian economy sounds like the canadian economy not some real estate bubble and wholly dependent on china and a fair comparison yes or no i think it is you know i'm sure that if we had peter schiff well he would say again you know that thing is going to happen the real question is what happens after those bad things happen you know basically canada has a commodity cycle that they've been living through in the same way that australia has and that's protected in the downside in two thousand and eight two thousand and so the question is is now that the commodity cycle is turning down now that china is basically rebalancing what's going to happen to the canadian housing boom is going to turn bust in the same way they did in the us and then what's the policy

response going to be when we're going to do that the big question what's the policy response going to be and i think that's where you know peter shergold what he was talking about earlier that's the question if the policy response is massive will it be able to give you hyperinflation no probably not is what i would say and thank you for your insight and connors thank you we want to have a segment without shoes to keep on coming on all of our social media platforms that's all for now from all of us here on bus thank you for watching see you next time but i have a great weekend. and . i would rather ask questions to people in positions of power instead of speaking on

their behalf and that's why you can find my show larry king now right here on our t.v. question for. i got a quote for you. it's pretty tough. to stay with that story. it's just this guy like it should be here that done started working for the people most issues the major media were pretty chummy right on stage. they did run it well. i'm. going to you're not going to.

happen. there are. live pictures here from independence square in central kiev blazing barricades there set the country on fire rioters control seven local governments in western regions while while ukraine's east stands behind the president's. cairo meets the third anniversary of the two thousand and eleven revolution in grief after the city was hit by a series of bloody bombings on the eve of the landmark day. and thousands of protests against a social gathering of the far right politicians in vienna as nationalist movements gained popularity across europe.