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well here's aaron eight is off today our lead story today is bank of america and its recent settlement for mortgage fraud now this is being billed as the biggest post housing bubble mortgage settlement but before we do the terms of the deal i want to review just why bank of america's pain is first back in two thousand and

eight in two thousand and the u.s. government made a total of forty five billion dollars of direct payments to bank of america and its merrill lynch subsidiary to shore up the company since one hundred eighteen billion dollars in potential losses from bank assets related to risky mortgages would have rendered be insolvent these mortgages were often made on a fraudulent basis and by two thousand and eleven bank of america and other too big to fail us by. a blitz of what lawsuits from homeowners investors states attorneys general and u.s. government in two thousand and eleven a list of areas for potential prosecution was drawn up by the national association of attorneys general and the area was more extensive more gay. electronic registration systems mortgage pools bad securitization misplaced mortgage notes forced placed insurance illegal pyramid servicing fees document fraud for sale false affidavits and perjury foreclosure mills aka robo signing active military

members losing homes while on tour of duty in iraq and afghanistan now in two thousand and thirteen federal judge judge jed recall felt the fraudulent activities were so extensive that he endorsed a broad interpretation of a rarely used savings and loan era law to go after b. of a it has a low burden of proof strong subpoena power and ten years of a statute of limitation twice as long as a typical limit for fraud cases given all of this b. of a settled now you fast forward to today and you see this deal is a headline seventeen billion dollars and it's touted by the media as the largest settlement arising from the two thousand and eight economic meltdown pretty good well hold the phone remember millions of americans lost their homes to foreclosure and yet no individual was held culpable and put in jail as

a part of this deal that's number one and the headline figure isn't even real the banks will pay ten dollars in cash to investors who lost money during due to the fraud associate with the mortgages in the mortgage bond pools b. of a will actually only provide relief to consumers via a call a so-called credit valued at seven billion dollars now the a.p. wrote a piece on the so-called credit and found that under a similar deal with citi each dollar spent on legal aid councils for example is where two dollars in credit and paper losses on some affordable housing project loans can be credited at as much as poor times their actual value and the banks are getting a lot of these so-called credits for stuff they would have done anyway so at least that's what they're telling investors. what's more is in a similar deal with j.p. morgan chase for four billion dollars of credit relief j.p. had only claimed verifiable modifications on one hundred loans holdall for six

million dollars of relief five months into the program and this so-called relief is treated as a taxable event by the i.r.s. by the way so look bank of america is an institution that rewarded customer service representatives who foreclose on the homes with cash bonuses and gift cards that's a fat in fact according to court documents when supposedly trying to help homeowners in trouble through the obama administration's vaunted relief program service representatives were told to lie to homeowners and tell them their paperwork and payments had not been received when in reality they had they had been so that the bank foreclosed on them and now the justice department and attorneys general want you to buy the concept that this settlement is justice for millions of americans who lost their homes. and neither should you.

we talked a lot on the show how it's based on some tough times economically but one of our freaking guess is not as negative as i got the chance to sit down with economist and author jim rickards to discuss where he stands in europe and what he sees in its future she asked him where the inflation deflation debate is headed considering the european economy has begun to stagnate here's what he had to say. when people say record low yield fixed income analysts understand these are record low yields in nominal space they're not record low yields in real space for real space you have to subtract inflation so for example you could have you could have. nominal temper sent coupon on the bond but if inflation is thirteen percent the real wage is negative three now right now we have say a one and a half percent or two percent coupon on the bonds but inflation is zero maybe even

negative maybe even inflation so the real rate is positive one positive two so actually real rates are still quite high even though nominal rates are quite low and so for investors and analysts you have to focus on the real rights of these low nominal rates are a reflection of not only close to zero inflation but some expectation of deflation you know remember the ten you know japan. is they've been around eighty basis points for years and i think the u.s. might be heading the semi all this talk of a bond bubble no i mean that you could be said for the greatest rally in ten year treasury notes in history if they go from one two point four percent to one point five percent and that was close the gap with your opinion holds that would be a great bond rally now the again it's really important is to restrain what people call low not always the real rates are still pretty high and they can go lower. now the e.c.b. has been less aggressive than other major central banks so how do you see it acting or reacting going forward. well the thing about the e.c.b.

and this is really important to understand there and it is that they have a single mandate the u.s. has the so-called do in their day which is inflation and unemployment reducing unemployment and the fed has said that when they come into conflict which sometimes they do in the they are right now you have to pick one if you can't have both you have to pick one of the fed has made it very clear and yellen has made it clear in her speech is that they're going to do everything they can by printing money and q.e. and other techniques to try to reduce unemployment or correction create jobs employer is pretty low that's because people dropped out of the labor force but they want to do is create jobs and get those non-participants back into the labor force they're just not worried about inflation now in europe the e.c.b. they have a single mandate and they take it seriously the other thing americans don't understand about european legal systems is that they don't have the common law make it up as you go along system that we have they they are much more code based going back to the code and before that the code of justinian in the in the sixth century so they take these mandates seriously so druggie will do what he needs to do to

maintain price stability but he has no other goals in mind now deflation is not price stability if you have serious deflation he will ease up but right now he's saying you know price indices around zero a little bit in positive territory so he's not going to change very much i love that you bring up the napoleonic interesting you don't hear about that much and it's pretty fascinating stuff so i'm going out on and out of my library and i love it i really that's of a personage and i love that he's not going to ask you what is the chance here that the euro falls apart. a chance that well the chance of the euro falls apart in terms of you know members leaving or the euro breaking up of those in years past some speculation about a northern tier in the southern tier that's close to zero that's not going to happen in fact because i've been saying this for years this is a lot of people coming out of the. three years ago i was the only person i think gone on that side of the boat and what i said at the time was not only is no one leaving the euro the euro will add members which they've done they've got

a croatia they've got a stone in now i said something in my new book the death of money about scotland joining the euro of course you get left out when i say things like that but there's an independence for coming up in scotland in a few days let's see how the votaries out but it wouldn't surprise me to see scotland break away from the u.k. and join the euro as well so that the euro as a currency and as a political economic projects is a strong as ever now the cross rate between the dollar and the euro that's going to be volatile but you know i think it's at the low end of the range now i see it gathering strength and kind of chugging its way back to one forty in time. jim is trying to turn down early in the year it turned on the stimulus taps and ramped up industrial capacity now the daily telegraph says it's exploiting deflation in t. europe and that's why things are so sluggish so do you agree. yes china has china is basically exporting deflation around the world and the way you export your deflation curse countries want inflation because they want nominal growth to create

jobs and pay off the debt so when they're when it what they want it what they try to do is export the deflation through the exchange rate now they have been exploiting the deflation to the united states for years with a lower if you want cheaper you won against the dollar but that didn't that was running into problems because u.s. is printing so many dollars say to print you want to soak up the dollar so they were actually getting some inflation in china that has cooled off a lot lately so but the same thing is true it's actually a reflection of the fact that as china puts more and more money into europe. and the trade ties deep in the financial ties deep in that more of that will start to rub off on europe now having said that china has a strong bid for the euro and a weaker bid for the dollar so i would expect that again this deflation is going to be heading our way meaning the united states more so than europe but there's no question that china is importing deflation to the entire world through the through the exchange rate mechanism that's what the currency wars are all about. it's always such a pleasure talking here is there anything else you'd like to add. the other think

out thing i would add is that you know we have a lot of geo political experts over here and we have a lot of financial experts over here in the brilliant people but i think investors nationalists need to think of it as a venn diagram where they intersect you need to wear both hats at once because the geopolitics and the financial economics are getting so in tangled you really can't understand one without the other. that was author and columnist jim rickards. time now for a quick break but stick around because when we were turning we are not done talking about europe dennis gartman publisher of the garb and letters on to give his take on where that comic that caught in its economy is headed and in today's big deal with back to tonight contributor john up o'donnell is here to talk but debt and how it seems it's a hole that many americans cannot climb out of as the break here at the closing numbers out the bill.

would you like me you want your comedy news with some t. comedy news to be a bear fisted no holds barred fight to the dad. like a vampire fighting into the necks of a corporate elite billionaire freaks while they're going. well that's what you get with my new show projected in night. with washington this. is a. prophecy. that actually doesn't do too

much for my culture giant song seventy six year old american based in india. is going to create for the cia do you think this is what's triggering a race because the largest in the world it's also the largest debt. nation building instead of breaking news that is mostly about turning the status of the real events in the points of the working toward the american dream the next they were just trying to survive this time for americans and lawmakers to wake up and start talking about the real causes. ok we're back now while sanctions on russia have clearly had a negative economic impact there isn't been much of

a negative political effect and given the state of the economy in europe it's not clear that sanctions will remain in place will be lifted to explore this issue noted economist gartman gartman is a capital markets expert and the editor and publisher of the garden letter she asked him what he believes europe's next move will be in terms of sanctions and russia here's what he had to say. no i think they'll end up pushing for with more sanctions i think they don't have any choice at this point they've crossed the rubicon as far as sanctions are concerned they're beginning to see that they are having an impact upon moscow and with the collapse in oil prices that's the clearest evidence that that's what's happening i think they'll continue to press forward even more sanctions putin right now has what eighty to eighty five percent public support and that's understandable given what's gone on in ukraine but if again if rosner if that's what has to come to the government for a forty two billion dollar loan to to accommodate itself the other parts of the

roof of the russian economy are going to be under very severe strains and the support numbers for mr putin maybe a month or two from now will end up going down below seventy percent relatively quickly it's not surprising that they've held up thus far but because of what's going on in ukraine people always become patriotic and always come to the support of the leader of every country in an environment like that but as long as if this continues in a crude oil stays down if food prices start to get higher if goods begin to disappear off the shelves his public support numbers will fall off the edge of a cliff. now i also notice that our russian urls proved that fell below one hundred dollars a barrel and worried or is claims that the russian budget is predicated on balancing out one hundred fourteen dollars a barrel now given that companies like you said rosneft are asking as much first much as forty billion dollars in support because of these sanctions that's obviously a problem for russia but what can they do to get out of this other than stop doing

what they're doing in ukraine. let me think they should stop doing what they're doing in ukraine. that that would that would solve the problem very quickly. they think about it you've got to if you're russia and iran whole budget is predicated and it really is predicated upon one hundred dollar plus crude oil pick a number whatever it is let's call it one hundred ten and leave it go at that and now you have the kurds who put in the colloquial expression stole their oil fair and square from iraq if you're a kurd you're selling crude oil as much as you can because you have no fixed cost you have no. inherent cost in the oil that you can sell you will sell it at any price because you're going to get whatever you get is free money you're going to sell it to glencore you're going to sell it to all you're going to sell it to a gun or one of them is going to take it at a terrible discount russian crude oil prices are going to follow that discount so

your real enemy at this point are the kurds and you've kind of made them angry. now global oil prices not just earl's crude but brand my and saudi late they have all been falling despite the conflict in ukraine and problems in iraq so is this about demand destruction economic weakness there or booming oil supplies what is this about i think it's really about booming oil supplies more than demand destruction and there's not that much demand destruction although there is some at the margin we in the united states for example are driving less now than we drove in two thousand and five before the recession we're learning how to drive more effectively in our cars are so much more efficient than they were before as i like to say my first one i got my first car in one thousand nine hundred sixty six it was a wonderful plymouth valiant it was a great car i loved that car it was in the economy car it got nine miles to the gallon my car now is a jaguar that's ten years old it gets twenty eight miles to the gallon to my wife's

new b.m.w. gets about thirty five miles to the gallon so we're driving less and using less gasoline there is demand destruction but on the other side i think the real characteristic of the oil market is supply supply is coming everywhere where god was not so surreptitious to make only the united states capable of fracking for new crude oil the chinese are fracking the germans have given up on fracking they ought to they ought not but they will the english are beginning to frack the french are going to frack russia is fracking we're going to find we're finding so much crude oil around the world as i've said in speech after speech we have there's a this a very esoteric economic term there's a gob of hundred twelve to fifteen dollars crude in the world we're going to go down and find out how much eighty dollars crude there is before we shut off supply so i think it really is a a supply increase rather than demand destruction that's taking place what's going on elsewhere in the commodities space and is it reflective of global growth or we

can't. well i think one of the interesting things is how we grain prices have been of corn prices have plunged wheat prices have plunged soybean prices have plunged i don't think it's a matter of demand that has been destroyed but it's simply a fact that the weather has been perfect despite what al gore has one has one has warned us about there is no such thing as global warming this is global moderation and most of the crop areas in the world with process of possibly the exception of india which has not gotten as much rain in the monsoon as they'd like but they've gotten a reasonable amount of it grain prices are grain production around the world is is is extraordinarily large and we're better at it our our our scientists have created much more drought resistant corn much more drought resistant disease resistant beans and wheat in speech after speech that i've made i like to tell people that we have to change the lyrics in the united states we can't talk about the amber waves of grain anymore because we have genetically engineered the we crop instead of

being four feet tall we've engineered towards only two feet tall so the weak crop doesn't grow the wheat stock it grows the wheat kernel god bless the the universities and the companies who have been able to genetically do these sorts of things so yes but i mean my feet are poisoning us in the process. ok we don't bet on each and our no i you and i we're not scientists think these are these are genetically modified foods that we've been to because they don't grow in style doesn't mean they're better for you i'm not saying that they're worse for you the fact matter is we don't know today well i will take exception to that we've been growing genetically modified wheat now for fifteen years and i haven't grown a third eye yet right but your grandkids night now i'm jumping out of here i have. done is i have one last question for you how about the other than about precious metals what are you seeing there. it's boring isn't a goal just seems to be anchored in dollar terms at or near thirteen hundred dollars an ounce i've been bullish of gold in terms of yen and bullish of gold in

terms of the euro but i that's only because i see gold as being nothing more than another currency and i tend as a currency dealer tend to cross one currency against another but gold is boring and there's no there really isn't an inflationary impetus out there with cruel prices collapsing with grain prices collapsing with livestock prices now collapsing at the same time which is very interesting with cotton prices falling with steel prices down one how can gold stage a major rally it just can't do it it can't get out of its own way yes i understand that the bank here in the united states and the the bank of england and the pm the bank of canada and even some of the banks in australia new zealand have been expansionary but it doesn't seem to be it doesn't seem to give rise to higher higher gold prices the gold bugs have been arguing bullishly for months and months the gold should be soaring because of enter the because of the central bank intervention and it just hasn't happened so i think crude oil i think gold is an

extraordinarily boring circumstance right now. that was dennis gartman editor and publisher of the guardian letter for today's big deal. to do today's big deal i am joined by john f. o'donnell of redacted tonight here on our to and we're going to talk about debt first let me run some facts and figures on ferguson by you how's that for a little race that burgess in missouri there are over twenty one thousand residents about eighty two hundred households twenty two percent of which are below the poverty line there they have two points. million dollars in court fees and and twenty four thousand arrests and here's the money quote from alex who's an

economics professor at george mason you don't get three hundred twenty one dollars in fees and the rewards per household from a about average crime rate you get numbers like this from. like jaywalking that low level harassment involving traffic stops a court appearance and the threat of jail for failure to pay wow so john it looks like the background story for ferguson is really about a county or a city that is milking its residents like a cash machine i mean first of all it's got to be really bad if economists are using curse words to describe it really do that number one and i've heard that islam is crazy like thirty percent of the city of ferguson's revenue comes from just these scofflaw offenses if they're even that exact it's the number two revenue sources that's unbelievable that's unbelievable i mean it seems like it's just like

instead of people being innocent till proven guilty it's just they're they're just guilty for living there and they're going to get caught and then they're going to just be essentially robbed of money we'll that's what i want to talk to you today i understand you have your hands on a document now called the debt resistors operations manual and that's some pretty intriguing tell me what's in this what's in this first of all i like the way that you frame today because it sounds like i got my hand. documents that reveals the truth about what's going on but in a lot of ways it actually does this this document is pretty amazing it was it was it was created by this anonymous group of activists and writers and academics and it's a combined effort between strike dead dot org and occupy wall street and it was it was written in response to the two thousand and eight economic collapse. and it really explains what's going on with all of these different types of debt and gives a lot of pointers and tips on how to stay out of debt how to repair it if you're in

it and it really explains kind of context and history in this stuff and we don't understand all the ins and outs of what's going on but we do know as a country we're largely in debt and it is you know some say undermining democracy and hurting us interest in the you would say that. thing up here in terms of the types of debt that. you go through look what kind of debt are we talking about absolutely well obviously it covers a lot about number five their housing debt and stuff like that and and the mortgage situation and give some context and history and that was really interesting i don't know student medical debt credit card and the credit score and consumer reporting agencies these organizations are very secretive for whatever kind of algorithm they use to decide what these scores are people are going to get and a score they say in the book it's almost like it's like a barcode on you it's like a it's like a tattoo of what sort of economic things are going to be able to have access to and achieve and things like that as the three major credit bureau or credit credit

checking agencies they've made profits in two thousand and nine of six point seven billion dollars and a lot of other countries these are public institutions and things like that. well you know understand a lot of people's credit scores suffer even when they're in a whole lot of debt well kind of. stuff can you do to make sure that your credit report is good for you or your i mean you're absolutely right first of all what happens is a lot of times there's errors all over this this place you know where it's sometimes it'll be like oh this is somebody else that that that isn't me that has this kind of delinquent thing going right i saw it once that my dad was the same name as me i saw that his debt was actually on my credit report really see i was the reverse would have been for me because my dad has the same name but better credit. but yeah so some things that. people can do in a d.i.y. capacity first thing to know is there is a way to sort of game the credit card systems as in not getting tricked by these

teaser rates as when you shop around you look for which credit card has the best introductory rates let's say it's six months of of of no interest of interest free with some sort of rewards for using you know system or something like that what you do is use that credit card right up until that time and then you either close it or you pay it off completely and then you use another one and you just keep gaming them and establishing credit and you know not have to pay any interest but if you're already in trouble what you have to do is you know if you get your credit reports you have to make sure that everything is correct more often than not it's not going to be correct so what you do is you have to write to the you know the corresponding appropriate companies and our bureau and then keep fighting for them to correct it and eventually will and your score can improve you know we only have about fifteen seconds now but tell me about redacted to ok i'm a political correspondent dr tonight it's it's our to america's new comedy show where every friday at least campos sit yeah our newest show is going to be lead

covering the militarization of police in a funny way may i'm talking about obama being slammed by hillary in a funny way and it's going to be fun follow us advocates and i we got to go but we'll see you tomorrow thanks for watching thanks fredricka thanks for having. the government says it wants to close the secretary of defense and defense department are committed to the president's goal of closing guantanamo bay. why are there so many legal group locks for the remaining. states constitution doesn't apply to these proceedings the government has demonstrated that they have no respect for the attorney. no you can't. see the place with.

those issues and much more. like.

as many as three hundred american. blood. the details of.