decimally handsome man back in one nine hundred seventy one an old scary haggis if you care to look in the right place you see back in one nine hundred seventy one when uncle sam was that handsome young man one wage earner could support entire family in the u.s. economy incomes were growing for all in america was an export powerhouse were dreams could indeed come true it was then that nixon decided to close the gold window and turn the monetary system into a painting on a dollar bill and in exchange for this deal with the fee devil the u.s. economy would never age we were told we could lead lives to balance currency without cost. i've got news for you the portrait of uncle sam has been hidden in the basement of fort knox behind the barbarous relic old gold and that portrait of uncle sam my dear people shows a tired haggard and old dude from monetary de boucherie fiscal murder empires

of dead and banking immorality oh what a fantastic story stacey has a terrifying story and in fact our headlines are the proof of this horrid looking old man and these portrait of opal sound the first is a tweet from the wall street journal and it says more companies in the u.s. are closing than opening that tweet also includes this chart which shows the blue line is the entry rate and the red line is the exit rate and it goes back from one hundred seventy eight to present so you see that blue line of the entry rate is you know a new company and there's less and less and less since one nine hundred seventy eight yeah i love this idea of compare it to portrait of dorian gray obviously a famous story of a guy who makes a deal the devil and his portrait ages but he remains young and nine hundred seventy one the u.s. actually made a deal with the devil by going off gold and embracing fear of currency but the

statistics they charge the reality on the ground the economy is collapsing wages are down manufacturing is down the chart you just showed shows horrid economic decay so that portrait of uncle sam in the basement or in the basement of fort knox behind the goal is looking a horrid ugly and balanced and so it's only a matter of time now as i as i understand the story before these two things are reconcile in a most unpleasant way yeah did it then doesn't the dollar stab itself to death and it will be found on the ground and the floor of the new york fed or their fort knox you know in the warehouse next to all the gold and gold will be there the chinese are going to show up looking for their money that the u.s. . owes them and they will get upset and or it could be germany you know germany is owed tons and tons of gold is held in the new york fed they could show up and be so angry that there's nothing there but a bunch of money that they start to stab uncle sam's portrait and lo and behold on

the floor is the reversal old uncle sam having spent all that gold many years before in the world recognizes that this has been a horrible ugly travesty of course in the original story not your uncle sam version but in dorian gray what he did is he sold his soul to stay young looking and that no matter how much debauchery murder or anything he would do in morality it wouldn't show up on his face but it would show up on his portrait and it was turning into an uglier and uglier thing well here in the u.s. they also did the same deal once they switched over to feel currency all fee at back by nothing then all the bankers and private equity firms the hedge fund everybody started committing fraud and thinking it's not going to show up in the portrait of the u.s. economy because g.d.p. would always rise would look fresh and healthy and wonderful but behind the scenes of course gold and all of the cities like detroit falling apart though if you peek

into those cities that's like looking at the portrait of dorian gray it's like. exactly the dow jones is making new highs but at the expense of sacrificing detroit sacrificing michigan sacrificing baltimore sacrificing industrial areas of the united states sacrificing the end of the entire state of california which is now having its worst drought in history thanks to the sour on sustainable immoral economic model that is the u.s. resulting in this bifurcation of reality and portraiture resulting in this reconciliation at some point where the old hag uncle sam reveals himself to looking like some monster for. well now i want to look at some of the debauchery that has been going on in private equity and hedge funds the headline reads hedge fund and private equity fund rent seeking high fees crappy performance so this is from e.

smith naked capitalism and she looks back at there was actually a paper in the one nine hundred eighty s. a short paper published in the early one nine hundred eighty s. by robert joseph locke in shock and life are discussed with some puzzlement that the asset management industry delivered negative value meaning it was extractive they seemed perversely optimistic that investors would over time realize that fact and industry would shrink so they thought people would look at it and say well why am i giving my money to a private equity fund or hedge fund because i just lose money but instead because of this portrait of uncle sam this confusion that people think uncle sam is getting away with all these crimes he looks great he looks gorgeous this is the way to make money but in fact people kept on piling in fact more money was piled in into private equity and hedge fund fraud and debauchery in america and around the world really investors are synonymous with amnesia this is

a story you could write every six months or every year that people are waking up to the fact that hedge funds under-perform the mass market have done so for decades but that story is written every single every single year that story is written meanwhile over there berkshire hathaway warren buffett's company he's been quietly compound in money a twenty percent for thirty years is the best performance ever in the history the world by doing absolutely nothing but buying large stakes and predictably predictable earning companies like coca-cola i think maybe only george soros beat beat beat them over a certain period of time but hedge funds are ninety nine point nine percent of the time underperforming those two guys and because they simply cannot match the. predict. bill of the that is the heart of these markets there's only really one way to beat the market you have to go like it like warren buffett does which is the take it takes control of the market he owns the market he has the market he's not really betting against the market warren buffet is the market so like i said

their departure e and crime of the hedge funds and their low returns nothing adds up two thirds of hedge funds fail but no more i just came out with a report and they also look at it and they find that shockingly pension funds are piling into it if you look at this chart this is from no more a and on the left or the percentage of assets held by pension funds in various assets at the bottom on both sides of equities and then the gray is bonds light blue is property and the dark live atop is private equity and hedge funds where you see is that the assets under management by pension funds they put ten percent in private equity and hedge funds but that represents forty percent of the fees they're paying but they're losing money on that i'm paying more and more in fees so they're still piling into that and what number concludes is that say in our view alternative assets as a group show consistently poor performance beta is high output is near zero if not negative correlation with standard asset classes is high return and diversification benefits are negligible but the pension funds and again it's where money goes to

die it has been. twenty five thirty forty years since the modern pension fund industry came around it's always been a large pool of money run by somebody of low intelligence it's very easy to get a pension fund manager to buy a really bad investment they're not particularly smart people they get paid really poorly they just are sold toxic investments by sharpies on wall street and not only do workers get ripped off by their wages being destroyed by inflation destroying the purchasing power but then their pensions are stolen by the same people who are engineering his own policies so that's why people in america are living such horrible standard of living in the average net worth of americans been cut in half and allow six years again but go on with this dorian gray. a theme is you know you don't collect your pension for thirty forty fifty years once you start it so this is the door dorian gray the portrait is in the pension funds people don't know it yet but when they get their own will sound has not been so kind to them it's they

they retire and find out oh my god this portrait of my future i had back then is haggard and old and deprived and decadent and decayed and an old ugly man on the ground well i mean a good example is social security social security pays out money at the same time it takes in money and those two things are supposed to balance balance themselves out in what's called a good ponzi scheme well the good ponzi scheme is set to run out of money entirely in about eighteen months so the entire social security scheme in america is going to have to formally be declared bankrupt that's a liability that'll be kicked up to the federal government of hundred or so trillion dollars to add to the seventeen trillion dollars on top of the other unfunded liabilities of another hundred or so trillion dollars that's why america technically is bankrupt so going back to this report about hedge funds or private equity one study concluded that investing in hedge funds produced from one thousand nine hundred eighty to two thousand and eight produced only the same returns as

investing in treasuries meaning investing in stocks would clearly have been that handily so here they were wildly speculating de blas criminal fraud all sorts of crazy activity monitoring your pension fund and the haggard this is in is is hidden behind this sound looks great but in fact you should have just invested in the treasury if you would we had the same return oh yes very much from out of jurors tend to be corrupt they collude with each other they manipulate markets they work hand and glove with corrupt bankers like goldman sachs or j.p. morgan they would buy the same stock while selling the same stock simultaneously wald putting on a hedge to totally insulate themselves against any risk whatsoever in charge of enormous fees for doing. probably balance nothing they walk away with the eighty million dollar home of the hamptons for especially running a ponzi scheme and no it's great recently is that part of the scheme or pyramid scheme that is herbalife was the subject of two hedge funds trying to take it over

there you have to essentially ponzi schemes financed by the federal government hedge funds trying to take control of a pyramid scheme herbalife so this is really the tail wagging the dog multiplied to an extreme level for so finally in this headline about this portrait of uncle sam what we have is s. and p. wealth gap a slowing u.s. economic growth economic disparities appear to be reaching extremes that quote need to be watched because they're damaging to growth said beth and both you know chief u.s. economist at s. and p. so what they found is that because of the increase in wealth and income gap it actually is causing slower growth it is harming the economy is causing not the young looking hot dorian gray but the old haggard uncle sam because it turns into boom bust boom bust because the poor need to increasingly rely more and more debt and also less and less consumption one once everything goes wrong and they're cut off from the debt so again this dorian gray isn't really a gloomy economy or is it the haggard old painting of this in the attic so that

moment reconciliation is fast approaching in the story at the end of the story when the really the reveal of the american economy local sam as being an old hag is shown and that'll take manifest itself essentially and i believe in a sudden burst of inflation so food and energy something triple in price and america goes down the tubes as we all knew what price days are going to go effect yes and everybody will be toothless toothless old hags well all right well stay tuned for the second half i'll be continuing my interview with nick lambert and david irvin made safe. the try to play play polo going to. be

a much more efficient thing every minute. cut may. go well. like the. most famous thing sim city all time place cases most elite clubs players sometimes for nothing. this season and it's a challenge to look just keep up the still plays good be just to be safe be a stage eight look easy. but the speech was. plenty. to play right on the scene play. the first string.

and i were being butchered. play. on our reporters with the uninstall play. the be in the lead on the odd. cut. but you got a lot of sneering and negative press for your engagements here in russia especially for your public appearances for if. they weren't explicitly political you were just supporting sports many of the things that certain people who zoom has become very

adept at is controlling the media for example right here c.n.n. do i think c.n.n. news you know completely telling it like it is no i think is a have an agenda i think through is is bought and paid for. lead. play. welcome back to the kaiser report i'm max keyser time now to return to nick lambert and david ervine from a safe and acronym for massive rave internal disk secure access for everyone

gentlemen welcome back thanks much on our discussion about made safe this new phenomenon sweeping scotland so just to review recap a little bit for those who missed part one and give us the little twenty second version of made safe what is it made safe as intimate as it was supposed to be intimate with intermediary companies no one else will enjoy a veto so if i'm going to speak to your inmates if i speak to your note and i was speaking to you know to keep the corporate speaking to you and there's no ability to steal that information and sell it back to you if you're. to own to the meat safe network of the safe network. then stay in front of or it can be deleted it can't be cut up to do tobacco so the storage is on people's hard drives in this distributed network and to just sort of to be a part of the network you get a token yeah actually you get a look and you don't actually need it we're actually been able to do the work of an

algorithm where everybody in the world will be able to join this network for free rent use it for freak is one of my early things was some pearson in africa is given the ability to contribute and consume information the knowledge and leaps out from behind the bush and his cure cancer the ears that are told that's the important thing information the ability to be spread what and brayed to means that we've got much wood innovation spirit well now you're cutting into the whole patent business so patents become intellectual property that is highly protected and the example of various plants actually in places like africa and it being distilled by for. armistead recalls and patented and then sold back to the very afternoon where they got it to begin with so in this kind of system that information goes into the network and goes around all the current patent laws become accessible for freight and because it enjoys all these levels of encryption they can't get out at the same

way they can't get up and call him because encrypted they can't get at proton mail which is a new encrypted mail service so incompetent israeli the twenty first century. rallying cry for freedom and scholars is a place people rally for freedom yeah you're all about the freedom they touch and really important the most of the vote important thing about the safe network is based on not total disdain it's based on the does a. hole in the shoes or things that can be found in nature so yes very very high levels of encryption but the ability for a computer to connect to a network of computers be taken as the computer would be run and then given data to with often to make sure to sleep now after the data the network becomes almost like a lie you've. and it's owned by no one so if you're going to network and speak tonight. we don't know you've been on to network we don't know next on the network we do ignore customers we don't know any information about our customers and that's really important and it's never been done before because all of these even pro

forma any any system out there just know that says i'll give you security put your name your most secure or i'll give you security at logon to the several i control the most secure or privy to unless it's really into it to you know secure because i could delete it so in a safe network you decide to join we don't know you've gone to the network in which you've done a perfect fool if they can it's a network you could be to want to interact with who you want to interact with no one can look at you and i guess is scrubs on the very first whole pizza takes so you're you can actually go through completely compromise with those that doesn't the network just. doesn't care it's interrupted all the way through so this is. implementation of exactly where the internet should have been the freedom for everyone it's the ability for us to communicate information on and consume information. from corporations and we i believe that it is the age where we

have news that is given to everyone. free of propaganda we are all controlled by his propaganda system and i would like to see something where you get a piece of news that says. three people were killed today in june was a little one of them was a ball more than just as a soldier it doesn't matter i don't want this for my son once again it's using distributed networking to disenfranchise all the gatekeepers in the middle man so that it creates sovereignty and freedom for everybody on the network and you guys are from scotland this is all happening in scotland of course i want to talk about royal bank of scotland for a second but before i do. we've got a lot of interest in the auction that when that happened there's the auction of the coin that there was some controversy about the auction can perhaps nick you can walk us through the auction and what was the concern and what would you say to

folks now that are looking for some guidance on this yes i think i think what we're doing was where as a significant previous episode we were actually offer kind of p.c.l. in the ability for users to buy these tokens which would give them access to services in the network i was in a sale that was intended to take their t.v.'s. and we spent three of six million dollars in five or so really can a wall up close and we were taking. participation in two currencies one was a master calling and the was calling and we anticipated getting i would see at least seventy five percent and the rest amassed according to feel that we wanted to support the mass according guys with what they were doing because we were using their. they are smart properties which is a way of them issuing or talking before the networks launched so that the kurds will never worked like that it went so fast that we ended up with

a fifty fifty split and as it is obvious to anyone looking at the market cap master card is not to hugely liquid so what we've come away with is probably fifty percent of an ace liquid currency coin which is fantastic and we've got fifty percent of the less liquid. massaquoi which we're kind of holding for the time being and see what happens there but there's good reason to believe those guys are you know going going to do some but because of the next next few months so right so so master cohen is yes people call this big going to point out. it's more of a oh well how would you describe it i would describe it as a way of integrating all those things into the book chain so you can just basically you know a lot of the things in the book that isn't similar to a colored coin concepts are probably smart property or color coins so you take an individual coin and because big coin is being created on the hop for another million you know ten million coins or so over the next hundred years yeah this is

an idea idea to pull one aside and say it has a limited supply right now and you can do a stock offering you can do a deal offering you know you can trade as a contract offering years of course a save point it's proof. it's proof of resource versus proof of work so how does that work dave basically the resources as proof overtreat ability of the to what you're doing and we need so the network is the c.e.o. can you computer connect the network and it's like this on call when it was and and it proves that it worked was it starts off as a small computer with an infant and then it grows in rank it's given data and people ask for it and the network can tell the computer give that to it and if it did give the date a lot that if you want to see fill in and that's really the the proof of the chief ability of the it and. the machine it's all tame it's off to a bind but the c.p.u.

capability in the. then interestingly lou the network is intelligent as it has no ability to decrypt. the network with all its power to the to the house to be a human that those. sorts of people handle the client so proof of resource photos is. a more natural way because you're rewarding people for doing something that is good no to walking people for doing something which is normally electricity and not the balmy electricity was wrong for because there was little of totemist network fellow data into logan to for any purpose in a secure and private manner and but going to marry that as i. didn't have a choice really how to use or can i. make an ism and. of these things like walks i take the ten minutes and sips someone not to do and it's against

the b. i think i'm always trying to think of not to systems work can remove much in numbers the numbers are terrible fine and security in particular an encryption is one of the issues with so many easy curves ok so you imagine a couple times. ants and colonies and in this type of thing and we we seems like as economics and finance goes forward there's more observation of the way things happen in nature in terms of the economics of like the economics of photosynthesis for example it's a perfect almost frictionless market isn't happening on the level of photosynthesis how do you mimic that had you capture that with frictionless trading and these ant colonies are now are known to be extraordinarily efficient and accent or so do you draw on. oh i don't i'm trying to segue into royal bank of scotland somehow in every way it is yeah i mean every natural system there are rats and predators and lice and this type of thing and royal bank of scotland h.s.b.c.

barclays lloyds here in the u.k. you know i mean you know like your lower intestine has as has you know parasites but they're needed to some degree but when they take over the body you know you die so here you have like a just b. c. a parasite clearly a parasite the chairman is out in the newspaper. saying that enough of this banker bashing. you know we paid our fine this and let's move on now when you read something like that. does that make you feel like well you know the banks are going to start behaving better now so maybe we should just give up what we're doing go for the natural system perspective nature and the excess and greed leads to the demise of the species. so something with the. sort of food supply the buy is stored food supply of money and should have tight but we we kept

a life of eighty on natural system it was not shit all on the also capitalist and on to every other system we could imagine so what adam smith a one of the famous residents of scotland well he better think will he be looking at this kind of banking system right now would he be appalled pull ups that they think about money and safe going as i'm very. focused on this that to me money as oil that drives an engine and if you have someone that keeps taking our oil then no reservoir the engine goes dry valleys so money finishers does a trans fair all product and service what would wait which was adam smith's real goal was i can see where you might provoke the lever for whoever much your previous before that wasn't and somebody in the middle is going to double would profit on it so the idea of money and if i think if we consider money only just on oil from an engine is going to floors go it and if people are taking oil then we have to stop

them and making money for all money is a ridiculous thing it was it was illegal it was. a bill i think they want to use are a centrist and used to use it it was was illegal up to the seventh. the poet to make money out of money is a terrible thing you know i'm going to stop it there but one quick question one is a launch test that one's up running. through yet another six weeks each so that's your we're all going to die so guys really has a report thank you very spicy about all right let's go do it for this edition of the kaiser report with me max kaiser stays over i like to thank our guest nick lambert and david arrived from a safe haven like untouched areas of report so it's not. just nukes but it's huge and it's vulgarized darwin science punishment for an

uncommitted crying i was sterilised one could believe in eighty feebleminded still today for the few i don't know why he like you but i still don't know why genetic improvement through forced sterilization the basis for nazi ideology don't stop at just sterilizing not going to go to the point of death. for years rarely discussed on till now i'd really rather not talk about that right. dramas the truth be ignored. stories others refuse to notice. faces change the world light snack. food picture of today's news. from around the globe.

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trash just like full of. care gas rubber bullets and on rats are rocks for the fifth night in ferguson missouri we have extensive coverage on the protests that all began when an unarmed teen was shot and killed by police. it's thursday august fourteenth four pm in washington d.c. i'm in your eye david and you're watching our team america we begin today with the latest album.