plenty well. science technology innovation all the latest developments from around russia we've gone to the huge earth covered . the. place it was terrible they come up very hard to take a plunge again a little longer there's a plug hat never had sex with the earthquake there's no list let's play. lists legitimate lists lists lst

split. for the people. star wars. for the finish line of the hour on. my. head over there i marinate and this is boom boston these are the stories that we're

tracking for you today. first up credit suisse is facing fire today after the justice department alleged that the swiss banking but he meant he was clandestine methods to help americans hide billions of dollars from the i.r.s. we'll have that story coming right up plus we have part one of my interview with the host of our kids kaiser report max kaiser on today's show he'll tell us all about his personal venture into the world of crypto currency with max going you won't want to miss my interview with him also we have american macro economist and co-founder of the center for economic and policy research dean baker is live and in studio today we're talking to dean about the u.s. economy both past and present here won't want to miss a moment and it all starts right now.

banking giant credit suisse is under investigation by the u.s. justice depart. for allegedly helping its rich clients paying their taxes now a senate investigative report released on tuesday claims that bankers at credit suisse used cloak and dagger tactics to help wealthy american clients stash billions of dollars in assets out of sight from the i.r.s. that is now senate investigators say the bank went so far as to open a special zurich airport branch listen it's in the airport and this is so that customers could fly in meet their private bankers and then quickly hit the slopes right after not too bad if you're one of those v.i.p.'s now according to the report the v.i.p.'s would use a secret elevator to be whisked to a private banking suite while bankers use peltry meeting rooms to avoid sending account statements or leaving

a paper trail now credit suisse held more than twenty two thousand accounts for u.s. customers that's a lot of accounts and with assets valued between ten and twelve billion dollars that adds up to quite a pretty penny executives from credit suisse are set to testify to the justice department in a hearing on wednesday chief executive brady dougan will hit back saying only a small group of private bankers were involved with helping americans conceal their wealth however here's the quandary we know that there are politicians who have offshore bank accounts mitt romney comes to mind for example i think he's got a couple and why do people have offshore bank accounts well there are a variety of reasons but a lot of the time it's to avoid paying taxes however the current colossal colossal tax code here in the u.s. permits these a base of accounting gimmicks and there are billions more lost in accounting gimmicks right here in the u.s. gimmicks like for example the ability for people to earn wages that much lower tax

rates thanks to long term capital gains i'm talking carried interest here horse what else have a dog and carried interest now are officials turning a blind eye to a problem here at home or are they employing distraction tactics with this whole credit suisse business we'll let you do. tokyo based mt gox was once the largest because an exchange in the world now it appears to be bust the question today however is whether the whole propos currency movement has been dealt a fatal blow now if skies are the dynamic to report here on r t is a crypto currency evangelist and he thinks the mt gox episode is good for crypto currencies because it strengthens the community by a limiting exchange with poor systems in controls max has his own crypto currency

max coins so i began by asking him to give us the full deep read on max going take a look. is next generation cryptocurrency cryptology is stronger it's faster there's a lot of money moving into alternative currencies like. this is one of the fallout from the bitcoin situation with mt gox people realize that they need to diversify into other coins other crypto coins and max coy is immediately one of the most popular all to currencies as they're called are crypto currencies in the market and we've got some surprises coming from and some enhanced runs through the cryptology that will place a probably the salute cutting edge of crypto currency is if i want to invest in mark's point what do i need to do for the layman if it's just someone watching today what would they do to go get some point. well there are a number of exchanges that offer max coin including m. c. x.

now which is the first major crypto exchange to offer it there's a lot of crypto trading going on right now people are trading in and out of bitcoin they will acquire bitcoin position then they'll go to an exchange in the choir max coin position so once you enter the crypto world you're free to trade in two out of different currencies but you have to make that first move out of fear and into crypto so most people go through big coins and once you have a bit coin that's kind of your gateway into these other alternative currencies like max coins so the market capitalization day one got up to five or six million dollars there's a several million that have been created or mind already people are mining these things in the twenty four hours a day they're making money mining mack's going and they're going to exchanges they're exchanging them for other alternative currencies for bitcoin and this entire crypto market is really becoming quite significant and i'm not surprised that you're seeing

a lot of the established banking industry quite nervous about what this portends for them right it could mean a lot of negative things on their side but you know with mt gox having imploded is the big question going to zero that's the real question will big coin go to zero. no i don't think that's the case to say to imply that mt gox blowing up it will impact the intrinsic value of fifth coin is incorrect because bitcoin itself the cryptology and the protocol is as a value well beyond how it's traded on one exchange in this case mt gox i think it's showing remarkable resiliency in the face of the mt gox collapse if i remember if you look at like world com and ron lehman brothers bear stearns those are paper ponzi great empires that collapsed is zero or near zero because they were

there's no intrinsic value whatsoever with crypto with bitcoin you have one of the major exchanges mt gox going through enormous difficulties but there's still tremendous value people are buying it knowing that the long term value is very good you've got second market in new york a very sober launching more advanced trading platform to mt gox was really a toy. exchange where they were trading virtual trading cards from a few years ago they were never really in a position to be a serious trading platform so this is not a surprise really and the value of the big going to stuff is holding up very well and i expected to make new all time highs in the next six to nine months max what you say to those who say that you know for any crypto currency has no intrinsic value. well that's correct because the cryptology is extraordinarily valuable internet age where you can

harness the network of tens of thousands of computers to go through the algorithms in the protocols to decipher the machinations required to mine a bit coin and this at the end of the day has value above and beyond what is in the fia world remember a fee after n.c. technically has no intrinsic value if you talk to paul krugman at the new york times he'll tell you that well yes the u.s. dollar has no value except it is backed by men with guns. you know this is not really a currency so much as a license to invade countries star wars create kleptocrats become a monopolist it's not really a currency the u.s. dollar is not a currency the us dollars a license to commit war crimes pretty much backed up by psychotic warmongering pentagon that's not really a currency gold is a currency silver is a currency bitcoin is a currency the dollar is not a currency the british pound is also another license to invade in the extra exploit

and extort it's not really a currency percent has no intrinsic value. max we can always count on you for those sound bites like war mongering pentagon so i thank you now i want to ask you how do you get people other than true believers to transacting cryptocurrency when it fluctuates as much as big as i mean what are you doing to tackle this on the front of maps point well you're saying adoption of the currencies in countries that are undergoing tremendous stress so in cyprus they're now opened a coin bank and a crypto bank which is now just like any other high street bank that's doing business purely in point you've got venezuela active in bitcoin you've got eastern europe russia active in bitcoin the ukraine apparently is active in bitcoin so countries on the periphery that have been disenfranchised by the money center banks who are backed up with men with guns remember that's what i feel accuracy is about they now realize that as a store of value as

a way to transport their money they're adopting crypto currencies so when this will end up in the center of the global economy in the g twenty countries that will come later but it's already happening in africa and europe and south america they're already adopting bitcoin is becoming a way of life because they realize it's a great store of value great way to sun money and it's a great way for economic freedom economic sovereignty and the established bankers are really running scared i think this is what's behind a lot of the recent. kind of increase in banker suicides we've seen about twenty bankers have committed suicide the last few weeks i think that they realized the jig is up bitcoin is here crypto currencies are here that they can't compete with crypto currency the they fear having to actually work for a living and not just get printed money from the government and pat themselves huge bonuses so they're taking the cowardly way out they're killing themselves and this is what you'd expect in a club soccer city that's fed by

a money printing and quantitative easing so quantitative crypto currencies are really pushing aside the malevolent in fl. and psychotic bankers who do nothing but pat themselves huge bonuses star wars and create huge wealth and income inequality and actually ration that countries on the periphery they've really adopted decline and embrace state or their own crypto currencies but do you think most governments will see crypto currency is as a threat and try to ban them you kind of said yes but i would love you to expand upon that. flow that a lot of as you point out governments and people are adopting bitcoins for example in iceland they developed or a coin which is a crypto currency for the people of iceland you have them as a coin in the united states for the nation of the indigenous population indians are of the coach and nation are creating their own coin in scotland they're trading scots going again to establish their own sovereignty and service of will there be a pushback from the established governments in the established banking industry of

course there will be but they have really no ability to stop this wave of innovation just like they can't stop p.d.p. file swapping they can't stop bit torrent they can't stop the internet is that they are there when they're going to be fighting a losing battle so this is unfortunately for them. not going to be pretty i think again that's why a lot of these bankers are killing themselves because they realise that they're never going to win this battle against cryptocurrency they're taking the cowardly way out i say don't kill yourself compete on an open you know be a capitalist compete with don't just throw yourself off a building you know try to be more like a capitalist. that was max kaiser host of the kaiser report here on r.t. now you want to miss the second part of it with him tomorrow find out why he says the head of one big bank should be behind bars but time now for a quick break but stick around because that guy right there he's going to be with

us after return obvious figure to dean baker there it is about the u.s. economy and asking him to explain some of the trends in the u.s. wage and consumption patterns that we've been seeing and in today's big deal i'm joined by edward harrison to talk about the housing market will people around january a surge in home sales to look at some underlying trends but as we head to a quick break here's a look at some of your closing numbers of the bell stick around. we welcome are made in the morning to be terrific oh show me your team at work. boom bust it's going to give you different perspective give you one stock never

i'll give you the information you make the decision you both bring you the work the revolution the mind it's a revolution of ideas and consciousness. yeah it's true i probably would be described as angry i think i'm a strong no one single. while the housing bubble wasn't macroeconomists dean baker was warning people of the problems as far as back as far back as two thousand and two was a while before it actually popped and he was also a frequent and boucle critic of the policies which caused the bubble to inflate in the bear. first place now after the bubble popped and the recession he anticipated crushed the employment outlook for the u.s. dean has turned his focus to jobs we want to talk to him today to get his read on the jobs picture the u.s.

economy and the housing market dean thank you so much for being here one of the few people can say i actually called the crisis before it happened because a lot of people say they do but they really have to have a paper very early on how serious. it is in the interim well done and i want to start by asking you now the economy the economy was growing above three percent all through the second half of last year now people see one percent growth for the first quarter what is going on here can you give me some explanation of these two things going on i think the main force is first off the growth and second half of last year was inflated by inventory cumulation very very rapid pace of inventory cumulation i don't think anyone could think there would be continued so if you pull out the inventories the growth was somewhere little over two percent so that's kind of the underlying growth rate that's what you would expect it to fall back to once you have the adjustments so there's two stories here as we get into the first quarter one of the slower pace of inventory cumulation that means a drag on growth that's a negative second thing whether i was really whether i keep to i don't know i was

poor for the longest time to start preparing let's listen we're going to we always get bad weather in december and january so that's not news but this was definitely worse and i'm saying that because i got stuck in minneapolis because it starts to you know because i personally felt everybody said no it definitely was i would say through january it was noticeably worse but through february it definitely was so so i would say that was had an effect slowing growth you know half a percent maybe as much as three quarters of a percentage point so i think weather really did have an impact given the weather it had something to do with extreme weather in places that aren't familiar with it it wasn't like a lot of snow in new york where they can handle and there can accommodate it was atlanta and other that's right you had a lot of bears in the south that don't typically get such severe winters right and so the fact that i mean there. i was pulling it originally so that you know that new york that's nowhere boy you know that happens in january so that's not news so it is when you get in atlanta it shuts down much of the south ok now dean i want you to take a look at these two charts that we have right here they're from the same data site

now the first one if we get those back out there right now it shows the real wages plummeting during a crisis and then rising again recently however they have plummeted once again and now this second shark we're going to pull up it shows real consumption expenditures also plummeting during the crisis and then picking up briskly and then flat lining you can see there from twenty eleven onwards what do you make of the differences between these two charts well the wage story this is very striking to me we've seen very weak wage growth really for the last three decades the one period where we actually saw good wage growth it was the end of the ninety's right you know where we had low unemployment that's you know i think really fundamental so we've seen very weak real wage growth you know depending on exact time period stagnant or even falling slightly in terms of consumption people are able to maintain their consumption to some extent or even increase it to a large extent because of this increase in asset prices so this was the housing bubble so part of the story of the housing bubble was that it's people's house prices went up they were borrowed against their homes and they sustained or even

increased their consumption now that house prices fall and consumption of course is falling back with it right now do you think. this this chart that we just had up it kind of demonstrates the problems with aggregate demand oh no oh you know this is this is the basic story that you know we're stuck in a situation where we have been inadequate aggregate demand this is something economists basically dismissed as an issue for decades they just didn't think it could possibly be a problem and now we're having you know economists very pramod coms like larry summers talking about secular stagnation that's basically the story and until you know that the story i was saying is ok with three ways out of this one you can have another bubble thing in the right mind would want secondly we could have large amounts. government spending government deficits which we have to some extent but not big enough the third way is to get the trade deficit down which strikes me is the best the most rational path to go unfortunately there doesn't seem that much interest in that either in policy circles but that's the my view how we get you

know aggregate demand back up and hopefully would see wage growth again dean talk to me about this how what about trade how would that work we will start with trade when we have a deficit around five hundred billion that means that money being generated here it's spent overseas china mexico wherever it might be not creating demand here so it creates a big hole in the manner how do you feel that the best way to correct the trade deficit is get the dollar down because the dollar is what determines relative prices if the dollar falls by twenty percent other things equal all these foreign goods cost us twenty percent more that means we'll buy domestic goods rather than foreign goods people will hate hearing out there well we've done this before and there is no other way you would just that so the people are paying more course we're all going to you know we'd rather get cheaper imports but on the other hand i mean a lot of jobs for people and they won't eat that they want to well put actually there will be a lot of opponents to that and that thought but it you stated it quite well now why do you think people's consumption patterns are so static in the face of all the variation in wage an income growth that we're seeing right now why why the static

well there's a couple things i mean one is people are largely set in their ways but also a lot of consumption is pretty much fixed month to month you know you're not going to move out of your home you know that's a big portion of consumption your health care and there's a lot of things you know if you have a car you're making a car i mean there's a lot of things if you think about where you dollars are going an awful lot of what you spend month by month that's pretty much fixed you know you know people always have an option to go out to dinner or something like that so there are things like that but to a very large extent consumption is fix and that's what we really do see big ups and downs in consumption you know over over short periods of time right it's not like vacations are going to. going to crush that pattern and the big the big ticket items now i want to talk about this you wrote a piece with jared bernstein on called replacing a season let me get the time right getting back to full employment a better bargain for working people now in this i want to i want to ask you. how do we get to anything close to full employment you talked about this

a lot in the piece and i read it was fascinating but i want you to explain kind of to our viewers how do we get back to that well the key thing is we have to get demand up and you know we just went through the three ways again my best stories get the trade deficit down get the dollar down no there is another route that we talked about a little bit in the book and maybe this is the most promising way politically is to actually reduce the supply so one way to do that is through work sharing which is actually you know our model here is germany germany people often look at their unemployment it's five point two percent and they go well booming economy you know their economies grow no more than our economy the reason why they've maintained a low unemployment rate in fact lower than before the crisis is that they get employers to keep workers on the job when they see a fall off in demand and they cut back hours so rather than laying off ten percent of the workers they cut back hours by ten percent and that's a very good way to go it works and this kind of i we're running out time but i want to quickly mention this you are you know supporters of modern monetary very they've

long called for replacing unemployment benefits with a job guarantee and that reduces the social issues associated with forced i don't mess what do you think of this kind of idea i know that you're you're into it well i'm willing to experiment with that i won't say replace it because you have to see what they looks like if you're talking about having millions of people being played by the government you want to make sure you could do that when there was a blow up in your face jeanne i'm so sorry i wish we had more time i have a lot more questions and you explain this very well but that is all the time we have for now please come back very soon that was macroeconomists dean baker co-founder of the center for economic and policy research time now for today's big deal. and today's big home sales are up and edward harrison knows about it and he's going to to talk. about it now we're going to be discussing january surge and home prices

you know what is happening kind of on one hand mortgages applications they did mortgage applications that's what you do you fill out to buy a home they've been at their lowest levels in nearly two decades and this means not as many buyers are in the market heading into the spring season which is usually the busy time of year when it comes to buying homes so i got her start up asking new home sales are up but the more job creation seem to be weak what's been driving this recent recovery in home prices if this is the case in terms of buying a home in two thousand and thirteen things were looking up home prices were going up but actually the rate of growth has been declining in home prices recently and the interesting bit is we're talking here about new home prices and new homes are only seven percent of the market existing home prices or exit existing home sales i should say are at eighteen month lows so you have mortgage applications you have existing home prices down that's ninety three percent of the market you know the

fact that we have new home sales that's not really that big a deal right it's not it's not as important as they're reporting it to be a lot of let's i want to take a look at this graph really let's throw it up on the screen if we can now the bottom half of the graph shows how big of a drop in housing prices each city experienced at the top half of the graph shows how much each market has recovered have las vegas miami and phoenix the biggest drop and i mean they tend to win this stuff and the best recovery and so i thought the bubble bursting in these housing markets you know how how can this happen again you know it's happened before how can it happen again and can you explain what's happening in these markets because they are volatile markets they're crazy markets and there's a lot of jokes made about them but how do you how do you predict what's going to happen with the bottom fell out of these markets and no one was there to pick up the bottom and people came in vesta's real cash investors came into the market i

think we actually even have some graphs on that show it's either phoenix las vegas we can put that out there that out we can. you know what we see here i think this is this is the one for phoenix or it's the overall market you can see that those are all ok of cash investors was increasing as we had the increase now we have drugs as well as very ones that are you see that. here's the interesting thing. is you can see it's up except the part at the bottom is showing that even though vegas is still going up and we see big a sort of a harbinger of what happened elsewhere because they lead in terms of the way down and then leading the way up the cash buyers are now increasing and. so people are starting to get out the cash by smart money you know our money is getting out of that market and yet we still see that things are going up so the question is is is

this a harbinger of you know the market softening somewhat not necessarily the market going down but the home price appreciation softening so when you look back at what dean baker was say about aggregate demand or whatever being there to the degree that it's been it's been boosted by the housing market we have potentially a headwind in terms of getting that getting that g.d.p. growth so the question is why are they point out the smart money why you know that it's you explained it kind of but if you'd think that they'd ride it longer you know well the smart money the reason that they're smart is because they see every one of the sisters getting into the market when you're plumber tells you that this is the they've decided these markets have risen enough the gotten their money you know they've bought at a low price now they've sold the high price and rather than get greedy and take everything that's on the table take the chips off the table move on to other places where they think that there's a better return so real quick thirty seconds what do you think is happening with the housing market for twenty fourteen why do we have to. have

a softening of the pace of bond so i think that you know the mortgage application slowdown going to continue and then therefore the year over year changes that. see in things like the case schiller and x. are going to come out and so eventually we have. ed thank you as always have wished we could talk more about this but that's all for now however you can see all segments featured in today's show on you tube at youtube dot com slash boom bust r t we also hearing from you so please check out our facebook page at facebook dot com slash boom bust r.t. you can see and tweet out us as well to aaron aid at edward and h. from all of us here at boom bust thank you for watching see you next time cal.

today on larry king and of the superstar vernon davis cup as part of the n.f.l. is probably. just dealing with the world you have to deal with people who are coming at the left and right i mean you don't know what they want. is but it's obvious that they want your money. injuries. because i want to play plus within the next five to six years you see a lot of. us come out to the world sports will be n.f.l. be the last place i think that if they'll be the first place yes all next on larry king now.