maybe sometimes but in the case of illegal immigration rolling out the red carpet for people to come to a nation illegally just empowers more people to come and it certainly spits in the face of locals and legal immigrants who do obey the rules and bureaucracy so here i would say no driver's licenses for illegals in florida yeah there might be millions of them in the usa but that doesn't justify society bending over to make their lives comfortable if you want to drive in america be born american or become one of the legal way but that's just my opinion. you should know where you are.

there i marinate this is boston these are some of the stories that we're tracking

for you today. first up the rupert murdoch is consolidating his european pay t.v. assets in the hopes of coming up with enough to buy time warner and we'll look into what this means for the european media industry coming right up then we'll bring you part two of my interview with dr steve the hankie now some voices in the u.s. want to block russia from using u.s. dollar clearing facilities and steve is telling us what effect that could have on the dollar and it's the end of the week which means it's viewer feedback here on boom bust edward harrison i address your questions comments concerns are live on the show you won't want to miss the moment when it all starts right.

now and right now rupert murdoch wants time warner and he's selling off assets to get it friday twenty first century fox said that it was selling its a talian and german paid television assets to british sky broadcasting better known as b. sky b. which is by the way thirty nine percent owned by fox for more than nine billion dollars now this is just the latest sign of consolidation in the european media industry and the deal comes out through time warner rejected the billion dollar takeover offer by rupert murdoch's twenty first century fox now analysts expect mr murdoch will make an improved offer to acquire time warner and the sale of fox's european assets could prove that the company with will then have enough extra financial. munition that it needs to purchase what it wants now in the deal announced friday twenty first century fox would retain its minority stake in b. sky b. and by doing so twenty first century fox remains well positioned to take advantage

of any future deals aimed at consolidating europe's telecom and media industries now the deal still needs approval from regulators along with b. sky b. as minority shareholders and not to mention antitrust officials are definitely going to be scrutinizing how the takeover will affect customers choice but if approved the deals for the italian and german assets would allow b. sky b. to offer premium sports and movie services to roughly twenty million customers across europe now b. sky b. said the new entity would be the number one pay t.v. provider in three of the four largest markets in europe so it's not peanuts but here's the question is all this media consolidation a good thing now generally i'm against massive consolidation especially in media but at this point it's really just a shift of assets from one big plate to another big plate and i don't think the consumer will be adversely affected at least certainly not in the short term really mr murdoch has his hands in both assets and he's just moving around furniture in

order to make his empire bigger than it already is and with new business models like netflix coming into the game broadcasters now must compete with scale scope and technology but it sure looks like mr murdoch is game for a battle. states has the exorbitant privilege of the u.s. dollar being the world's reserve currency and it has taken advantage of the status of the us dollar and its foreign policy for example b.n.p. perry agreed to an eight billion dollar fine for not following u.s. sanctions and russia of course is also facing the pressure of further u.s. sanctions as tensions over ukraine increase now i spoke to dr steve hanke a professor of applied economics at john hopkins university about sanctions the dollar payment system and the possible effects of using sanctions to achieve

political goals now some voices in the u.s. want to block russia from using u.s. dollar clearing facilities and i wanted to know what in fact that would have on the dollar here's what steve had to say. for the dollar and dollar payment system this is potentially a disaster waiting to happen because if you look if you're four sided and you're looking out twenty years or something like that twenty five years the big challenger to the u.s. dollar and the dollar system is what it's china and the chinese won and trying he's won and knowledge is not a key even a convertible currency but it is making. great advances i just saw in the wall street journal yesterday the switzerland known as entered into a swap agreement with the chinese about using a was. so people aren't thinking ahead and short and the

west sanctions by the way never achieve their stated political goal you asked me will they have an effect of course sanctions always would have an effect will h. e achieve their political goal and the answer is no they store glee have failed to achieve political goals in the past. now bloomberg ran an article two weeks ago showing iran a target of u.s. sanctions with oil exports at a two year high of one point six million barrels a day now here's the question do u.s. sanctions end up hurting the us more then or iran more which is which one is the loser there. well i think both sides are losers i mean i haven't. been some kind of benefit cost analysis but the u.s. troops be leading and be the leader of the free world and be leading. the

movement towards more globalization and more free trade and more free commercial act activity peace and prosperity is the name of the game and people wonder why somebody like president clinton is so popular and had such a good record in the economy while it was peace and prosperity. you know we did have a little balkan war that thing got wand up in a hurry that was under the clinton administration but but basically there was peace and prosperity in the ninety's when clinton was president and also i might add that clinton was the most austere that is cutting the federal government share of g.d.p. there are only two presidents who have ever done that since world war two one was reagan a little bit and a massive amount by client clinton was very austere and so the combination

of free trade. deregulation and stable money was a formula for peace and prosperity in those clinton years which were very good. now steve i see that eurozone exports to russia are down thirteen percent while imports are down nine percent germany's economy has been hit by this as well so now a lot of people are saying that the russian economy was already headed down before the sanctions so do you think this fall and trade in is sanction related or not. to some extent it probably is sanction related we don't really know the russian economy was going. prior to. well even the olympic showy. so it was it was on a downward trip trajectory. looking like it was quite vulnerable to go into a slump and now of course expectations are quite negative.

now a recent gallup poll in which of autumn or putin's popularity seems to skyrocketed according to this poll and this is all from the last year while the popularity of the u.s. and e.u. has plummeted so how are the sanctions going to be effective if they're having well that's that was my earlier point erin and that is that sanctions do have an effect they are whacking the russian economy. but do they achieve their stated political goal and that is to you know change behavior or lead to some kind of the good. over problems that the various parties have with each other and the answer to that is no and look at putin's popularity i mean the polls i see and he's up about eighty percent or something like that he's certainly got a he's certainly more popular than president obama and or if you go to europe but you go down to the bottom of the barrel you've got president. francis i think he's

in the low twenty's his popularity in the public opinion polls so most of the western leaders have very low ratings the u.s. congress of course is much lower than obama and the congress is really were the warmongers and and sanction imposers are located and their popularity is barely above zero i think it's ten or fifteen percent something like that an all time low. now let me move on to turkey here first second steve air to wine is encouraging the central bank there to cut rates because the economy is not doing well now he says it won't stoke inflation but that's some kind of dubious to me but is there no one right. no he's wrong he's been pushing the central bank to cut rates and increase credit growth in turkey for some time now.

twelve months ago perhaps eighteen months ago the credit growth was about forty percent per annum and in turkey very high rates of growth but it's still about twenty two percent now that's that's very high rate of growth in credit so the credit is is still stoking basically and fueling too much domestic demand domestic credit is too hot in turkey domestic demand is too hot and that's why they run these huge current account deficits and turkey as it is they they can't supply . the demand the local domestic demand and so what do they do they import lots of things and and that makes the current account flip into a big massive deficit which puts turkey in kind of a vulnerable position particularly if if the if the carry trade ever starts unwinding and that is interest rates going up in the united states and and when

that occurs of course the hot money that one end of turkey which is very large by the way will start coming out and turkey will run into a lot of trouble i think. and that was dr steve hanke the professor of applied economics at john hopkins university. time now for a very quick break but stick around because when we return we're bringing you the best of the very best from this past week and it's the end of the week which means it's time to hear from you edward harrison and i are tackling your viewer feedback and our weekly accrued interest segment plus remember you can see also when speeches on today show on you tube you tube dot com slash boom bust parties and on hulu hulu dot com slash boom. now we got to go before we do here are a look at some your closing numbers of the bell time about a. bill

money is the root of all easy pickens and money is the root of all crashes or once every dumb dumb as what to what fool is want to sell. we chase profit very large very attractive and now very globally recognized source of oil for the world into the world's cheapest and best petroleum deposits have been going down we have to use more energy to get this energy industries grow like a cancer it should be square it's ten kilometers where. good old

area is slated for the remainder of her drinking water that's our world lead so everything serves fisheries we can't stop this is the end game when it takes two. as i've said to make one barrel of oil you know you're at the bottom of. this for a. week you are sounds. government system is to help poor people who are women but you can only change their life and nobody's trying to make money out of them those who want to make money out of them like me suzy. tons of things to learn she can do that shit and get on board still.

welcome back to the weekend that means it's time for our best of the very best segment first of carl denham grrr is talking about the apple i.b.m. deal he explains what he thinks is going on and why it's i.b.m.'s bid for relevance then francis coppola is on to talk about the difficulties of using monetary policy to manage the economy after that steve king talks about how our debt levels are incredibly high and how that makes our ongoing recovery even more fragile then the libertarian guru anthony randolph who is on next to talk about the relationship between bubbly assets and the health of state and municipal finances and finally to round out the best of this past week we're bringing you dr steve views on argentina's economic future in light of its current debt problems enjoy. maybe think about apple's basic business model with regards to their or their devices that are covered by this which is the i phone and you know mostly. there

are simply replacement models when there's a problem so you you send somebody on the field they give you another one or you send in your device they give you another one really isn't any onsite repair so the the concept of onsite support is well limited would be the nice word for it outright fraud would be the better word. the the one thing apple does get is an army of sales people to go into corporations and try to push their products. whether or not that has any kind of relevance to their sales rate is another thing entirely i think the answer is no i b m on the other hand has a problem and i think i.b.m. is really the reason that this deal got done did everything to do with coke at apple and that is that i.b.m. has become a company that has become one of financial engineering as opposed to innovation if you look at their results over the last couple of years what you see is decreasing revenues and increasing or express share and their way they're funding that is

through buybacks so essentially what they're doing is to c.e.o.'s which course looks great wall street but is masking agent cherish it in their core business so my suspicion is that what you really have here is a company flailing around looking for somewhere to stay relevant in a market that shifting away from them just as it did back in the oh the one nine hundred eighty s. and one nine hundred ninety s. when the mainframe kind of fell out of favor with a lot of corporate users. about this recently i looked at the same minutes going back to nine hundred fifty phone discovered that every recession they had raised rates too late and then too much after each recession so we are on risk of having it too late and then panicking and raising them to notch and that's because once policy takes time to feed into when economic effects but the f o m c and the central banks and other countries have to make decisions on a month by month basis based upon backward looking indicates it's because often

they're making decisions about what's going to happen going forward and what effect them on policy is having based upon what's just happened which may be nothing because i only did it last month it's quite a problem i see trying to judge when to raise rates and by how much. now when central banks begin raising rates they usually continue to do so so is it possible that raising rates too late means having to be more aggressive since the mere act of starting to to employ this rate hike regime increases credit demand as it's a signal to borrowers to lock in their rates now. yeah there is a risk and in fact again we've tended to see that in the past that when they have started to raise rates they've often raised them quite a lot quite quickly which has quite quite aggressive effects on the economy to be fair the last time we went into a tight talking cycle which was in two thousand and four they didn't do that they raised them very very gradually over a period of about two years the problem was they raised them

a bit too much and then help them too high. but they did actually raised in very great very gradually so an effect on the economy was gentler me go back to no it's ninety four where they raised them very fast there was there was a huge spike in and nobody wants repeat of that boring the the private sector in the economy that's why we haven't seen we didn't see it but didn't see the crosses coming that's why we got out of the crisis now because having deal even very slightly american private debt for from about one hundred eighty percent of g.d.p. to about one hundred sixty percent is rising again now that's why this slump occurred the decline in debt that's why the boom is starting again now the rise and it but amazingly this is still being completely ignored by conventional economists and by the federal reserve so yes that's the real danger the fragility of the economy gets greater as the level of private debt gets higher and we won back to

not in the not in not is recession when you came out of that in america the private debt ratio is about ninety percent of g.d.p. and it doubled until this crisis hit then it fell by twenty percent to having another revival from a dead level of seventy percent of g.d.p. higher than the previous boom began in and of course it's only going to take a tiny increase in interest rates or. a couple of companies going bankrupt carrying the debt levels there because they can't manage to roll over their debts so the system is much more french are on this recovery than it was in any previous recovery and that includes. right back into before the going back on the days of the with the great depression the economy has never been so fragile because the level of profit has never been this high one of the biggest issues let's just take the last one you mentioned for pensions is that in order to hit their investment targets and hitting their best and targets is required so that their assets and liabilities stay in line which is not had not been the case for state and in this

bill pensions in order to do that they've had to expand out the risk portfolio. of all their assets and so you now have instead of the old way that pension public pension systems were they were largely invested in long term bonds that mature it at the same time that people were retiring so that they could actually pay out these promised pension benefits with the assets they had available as they have a much more widely diversified portfolio which again sounds great for the individual investor when you talk about pension funds that means that you're going to have. all these funds that are now scrambling for where about twenty five percent of their investments are is they're going to get no yield from that means that they're going to have to shuffle what amounts to across the whole country trillions of dollars into other assets simply because of a pop bubble that means that you're going to see price fluctuations in assets all across the country in ways that would otherwise exist except for the bubble so i don't know i don't want to sit here and say that i can tell you exactly what's

going to happen other than it's going to be mis allocation it's only it's going to be money flowing into assets only because. it's factors instead of what's going on in those in those particular assets and that's going to create financial instability that's going to be problematic is where is the argentine economy headed . down the economic policies are. a complete disaster really sand they gave up and started breaking the rules of convert ability so this would go back before the. will default on the bonds this would go back and in one thousand nine hundred nine they started breaking most of their own rules around the convert ability system that linked the peso to the dollar and then. eventually we've had many years with kirshner's and power and it's been one. irrational economic

policy after the other so the economy's quiet vulnerable and i think if they don't default on the bonds economy of probably shrink by maybe a percent and a half or something this year if they default who knows that it could go down by two and a half percent three percent and terms of a contraction which is a very severe. depression actually. that was your best of the best from this past week time now for our weekly accrued interest. in my work area thank you for being here my friend now every friday and i put you the viewer into the driver's seat that he is through the show with your questions comments and concerns all sent to us throughout the week via twitter you tube and

facebook so let's dive right animal start with taylor singleton folks who says quote dollars ation is inevitable because the u.s. economy no longer dominates the global economy like it did after world war two when dollars ation was solidified but if mr persaud is correct that the market will continue to react this way then won't transition necessarily be dramatic and if mr persaud is correct we'll transition from magic thoughts comments concerning. your favorite jim rickards one of my favorite he thinks it's going to be dramatic as well he took the other side of that i remember when you were asking the question about you know what do you think about what jim rickards had to say i think almost the opposite i mean the way that i listen to what they have to say i feel like they are saying pretty much the same thing that the u.s. economy or the global call is dependent upon the u.s. dollar but i feel like it's the transition that is the difference between the two of them that is. thinks that this is

a stable equilibrium. thinks like the person who's asking the question that it's not a stable equilibrium they should be a sudden break ok so i think it's a possibility different sides of the same coin wrote now another him our comes from octopus five who says quote victor she seems overly down on a competing development bank the desire among them i think is not primarily bearing a sufficient return but softened and independence for. the west informed by their interests and needs sans the strings penalties demands adversaries and rapacious stupidity from an i.m.f. goldman j.p. morgan our city ed thoughts here you know interesting i heard just today the new. canada want to stop any world big projects in russia as part of the broader sanctions so you can see that the world bank is being used as a tool of financial warfare so the question really is for the brics if this is

what's going to do we really want to be a part of that system right it goes back to that last question if you're setting up the apparatus for a competing sort of system i think china is going to be definitely at the center. and you do have the potential for a clean break as a result of some sort of crisis down the law interesting stuff then we have a gable cain here she writes in to say is there a theoretical or model the limit to what the level of financial derivatives can exist at any one time relative to the real economy or is it the nature slash quality of the underlying asset that is the determining factor where there seems to be record highs in stocks and other assets derivatives act as a stabilizing force in the event of a substantial market correction slash shock or could the derivatives market seem in quite a complex system at a level of unpredictability in the event of a market shocks last correction example unforseen consequences and i don't know

much but i do think that this could very well happen you know yeah it was a very complex question so the great question two parts to it that i think were interesting the one is when he talks about complex systems i think by the name of rick bookstaver he talks about this whole thing about tightly coupled systems and we were talking about this before about. being single point of failure when you have single points of failure and. coupled system basically you have sort of a domino effect in the whole thing collapses and i think that the financial architecture that we have today is somewhat similar to when you saw. there were you know there was a domino you know they were everywhere as a result the whole system was tightly coupled i think that derivatives are not a stabilizing force there i think that there are a destabilizing force within you know your quadrillion derivatives that are on the books of these but right now we only have thirty seconds more but i want to

go one more question this comes from michael j. rates you can't let off can be without a correction that's because it artificially along the capital structure investment flows into otherwise marginal businesses the same is true for consumption patterns does michael g. have a point can you get off he let off without any correction i think the point is what he's saying is when you have a distortion because of the central bank. the austrian school basically it favors capital investment and that creates mell investment i think. there we go and thank you as always and thank you for tuning in we love hearing from you so please tweet us or check out our facebook page facebook dot com self-confessed r t handles are out or an aide at edward n.h. for all of us here boom bust thank you for watching and have a fantastic weekend we'll see you next time by.

the west is sad. especially leaving in this world when they believe that you know that. tactic. they simply don't realize when propaganda is being pointed out we need to go by that and actually gauge with the ideas information that is presented as well and confront that information. i think that's something that as you mentioned before not everything is black and white not everything isn't taken istic and the more that we can be i guess. open minded connoisseurs of information regardless of the source i think we're all going to be the. this is the media leave us will we leave that maybe. by the see your. play your part of the musical. issues that no one is that stupid with the guests that you

deserve answers from. politics only of our two. they put a gun to my head british reporter graham phillips gives a firsthand account of his capture and interrogation by ukraine security forces. human rights watch says the trainee military could have committed war crimes by killing civilians with unguided rockets and israel and hamas temporarily lay down arms for a twelve hour humanitarian treating gaza as strikes kill a family just minutes before the polls began bringing the total palestinian death toll to almost nine hundred.