hello there i'm marinated this is boom bust and these are some of the stories that we're tracking for you today. first up the f.c.c. is looking into mutual funds that look like hedge funds and call themselves all funds so what so what are these funds going to look into it ourselves coming up right then the latest addition to the boom bust team the octopus she is on the show today she's bringing us teleport from the black hat cyber security conference and in today's big deal redacted tonight has we can't seem to end with me to talk about the privatization of prison it all starts right now.

you've heard of alternative music alternative culture you're even watching alternative media but now we have alternative mutual funds yep welcome to you all to new you now while many investors are embracing these illiquid alternative funds the securities and exchange commission isn't so keen about the whole phenomenon the f.c.c. has launched a broad examination of alternative mutual funds in an effort to scrutinize one of the hottest and most controversial investment products offered to small investors today all funds or at liquid alternative funds have marketed themselves as a way to hedge against market risk by employing a hedge fund like strategies such as betting on some stocks and against others trading futures and using derivatives to increase leverage they're also a cheaper way for individual investors to gain access to strategies once only available to sophisticated investors now critics say that all funds are just watered down hedge funds and individual investors might. i completely understand

what they're getting themselves into quickly finding themselves in over their heads so far this year investors have poured roughly sixteen point eight billion dollars into these types of funds and with their surge in popularity the f.c.c. is focusing their inquiry on the liquidity of the funds their use of leverage and the degree of oversight provided by the fund boards so to give you a better example of how these funds have grown so quickly when a.q. our capital now that's a pioneer in this space launched its first mutual fund in two thousand and nine it managed twenty billion dollars by the end of june of this year it was managing roughly one hundred thirteen billion dollars that's significant jump other firms like goldman sachs blackstone and bank of new york are boosting their offerings in the space as well by launching their own all funds but not all funds are on board and many financial advisors say that they won't offer alternative funds because of the complicated strategies involved in managing them and their lack of long term

track record of success we just don't know they're brand new now my take if it looks fishy and it smells fishy it's probably fishy so buyer beware. now our next guest is definitely definitely not afraid to speak his mind i recently had the chance to speak with peter schiff favorite and c.e.o. of the euro pacific capital now peter believes that the current housing market is a bubble and says if something doesn't give the country could be flooded with homes that no one wants to buy take a look at what he had said. well i think this eco bubble that the fed has reflating in the housing market is already beginning to lose air and the media. for and speak

tween this housing bubble and the last one is the last one was more of a main street bubble and this is more of a wall street bubble because the principal speculators are hedge funds and private equity funds and very high net worth individuals who are paying all cash for properties and buying them on the interest of patient selling them at a profit or renting them out to all the americans who can no longer afford to buy but i also think this is a bubble i think a lot of the real state that was snapped up in foreclosure auctions i think people overpaid and i think the investors are now as just now beginning to realize that they overpay so i think the speculative buyers are leaving the market and there's nobody to fill the void because the real buyers are absent in fact if you look at the recent almost a to sticks the percentage of homes bought by first time buyers is at a record low and in fact home ownership among individuals is that generational lows so prices have to come down dramatically from here before real buyers can actually

afford to buy all the properties that have been bought by speculators and stump like the speculators who own these properties if they can't collect enough rent to cover the cost of ownership they're going to be selling these properties and look out below because when they put these properties up for sale again there's no buyers anywhere near the current prices so you're saying that speculators overpaid when these homes were in foreclosure and i is that correct yeah well initially in the process they probably got a good prices but then the prices began to run up as the supply of foreclosures was dwindling and more and more speculators wanted in on the action they started bidding against each other and prices were too high and some people might have looked at prices and compared them to where they were at the peak of the bubble and said well i'm getting a twenty or thirty percent discount so it's still ok you know what you're talking about a discount to an inflated price you can still be paying an inflated price is that actually if you look at what the. is to rent these properties out because you know

the rents are not going to be there i think a lot of people misjudge the market regarding how much they could actually read these houses for because it's very difficult to rent a single family home a lot of renters don't want them because there's a lot of other costs associated with it and i think it's going to cost these hedge funds a lot more money than they think to manage all of these single family homes it's going to be very difficult i think they've been off a lot more than they can chew and you know a lot of these investors they paid cash for the properties but that doesn't mean they're not in debt they might have borrowed the money through another source they don't need a mortgage but they still had borrowed money that they've brought to the auction house so they still have a lot of debt and if interest rates begin to rise and they have to service this debt but they're not getting enough revenue from the rental income they may be forced to want to put these properties up for sale but again if all the speculators want out who's going to buy nobody. peter treasuries have been doing pretty well with the ten year hovering around two point five zero level so do you see this low

yield lasting and if not what impact do you think an uptick in yields would have on the real economy well first of all a big uptick in yields would be devastating for the foley economy because that would create the bubble in stocks and real stated force a lot of banks to fail and you would have a worse financial crisis than in two thousand and eight but it would liberate the real economy and the real economy is being stifled by the low interest rates and what the fed is doing so but if the surface it would be very positive it might be painful at first but ultimately it would be a joy a pain that would be beneficial because it would lead to some long term gain but i think the main reason that we haven't seen a bigger increase in interest rates since the fed began tapering is because foreigners have come to the fed's rescue if you look at the increase in buying of treasuries from china from emerging markets in general from europe you look at

belgium for example you've seen this big increase that has offset the reduction from the fed which again they announced today they tapered back another ten billion and if it wasn't for all these foreign central banks we would have had a more dramatic impact on rates as a result the question is how much longer will the can we count on this support from our friends especially when we're pissing off so many of them with our foreign policy now many believe us shares are priced to perfection right now with the s. and p. five hundred having had twenty seven records highs this year so some american investors are diversifying into cheaper international shares do you recommend that move and why or why not ride been recommending that for years and i've been following that advice personally you. i think that people should be invested in the stock markets

the question is which markets which countries which sectors should they be focusing not because they're all not the same so i do believe that there are certain markets that represent a lot of value where the stock prices are not inflated like they are here where you get a lot more value for your money you pay a lower p. e. get a better dividend yield and you have a better prospects i think here in the united states you're right we're we're there's a bubble going on and in fact beneath the surface if you look beneath the average is a lot of stocks so far in two thousand and fourteen are in bear markets there are plenty of stocks that are down more than twenty percent on the year there are a lot of stocks that are down ten percent to twenty percent and there are some stocks that are making new highs but it's not that many when you look at the overall market and a lot of it is based on a share buybacks that are financed by cheap money and it's the low interest rates that make possible the valuations and some of the inflated earnings numbers so that if interest rates were to go off that would completely knock the rug out from under

these stocks because not only would it reduce their earnings dramatically because they would have to pay more interest costs on all the debt that they've accumulated to buy back all the shares but it would also impact their revenue because their customers who also are levered up they would have to spend more income on interest payments so they would have less to spend. on their products but now higher interest rates means that you have to discount those future earnings by a bigger number so the multiples have to contract so there's a lot of room the need for the market in less of course the fed comes to the markets rescue with an unprecedented amount of money printing which i actually believe is what's going to happen. that was peter schiff c.e.o. of europe with a capital. time now. for a quick break but stick around because when we return our t. producer beyond the fish eating is telling us about staying one step ahead of

hikers and how it's a hard thing to do for even the most seasoned cybersecurity experts and in today's big deal redacted tonight has the lead captain sitting down with me to talk about the privatization of prison and a little wal-mart stuff in there as well plus remember you can see all segments featured in today's show on you tube at youtube dot com slash boom bust or tease and on hulu at hulu dot dot com slash room dash dot com. now before we go here a look at some your closing numbers of the bell come on back with. the stories we cover here not to hear any other big story headlines there's a reason they don't want you to. reset. now let's break the

set. half of america tax goes to bed together and goes in defense budget to start these wars of convenience to continue the american empire around the world that warren buffett apart doesn't want to have to pay for those wars joyously to canada these are financial. cowards. to what extent do you think the american and british policies in the middle east have contributed to the creation of these very terrifying terrorist groups the western governments of fully understood the policies of contributed significantly to the radicalization of young men and women around the world this is without a shadow without i will confirm with all i would agree with some of the young men that we would certainly be rather close because of western foreign policy.

when we come to talk about addiction to cigarettes we understand quite clearly that there is no other smoking or not smoking we believe completely an abstinence. call quite understand why we don't have the same belief or drugs or alcohol to me the only way to productively dependency is to give up trying to go to. welcome back now computers smartphones tablets we use them for everything these days but just how secure are your electronics last week the boom bust team attended

the black hat conference in las vegas and it's a meeting of the best collective security minds on the planet. what we learned there. seemed to always be one step ahead of security which certainly isn't good for any of us need tells us more. experts from around the world recently gathered at the black hat conference in las vegas to discuss invent and technology and information security in the post snowden era meetings like this explore some of the most pressing issues of our time like whether or not privacy is that all attainable in the digital age the black phone the first allegedly fully encrypted smart phone was hacked after one expert at the conference found two new flaws in the device and this comes after a recent study released by hewlett packard that claims seventy percent of smart devices ranging from t.v.'s to home thermostats to automatic door locks have security vulnerability is all of this begs the question if the so-called internet of things where essentially any object can have an embedded computing system is

really for our benefit kimberly price the director of syntax red team strategic operations suggested the internet of things might be spying on all of us. my refrigerator has imbedded software in it and they know things about my eating patterns is that really matter i don't know. if we're talking about embedded health care systems where a couple years ago there was some research done where insulin pump could be remotely hijacked to deliver fetal dose of insulin that's a problem that's a security issue with life and death consequences of versus a privacy breach and we have to be looking at these very realistically in terms of real world impact and not if we overreact to the small things and i'm not saying we shouldn't react but if we overreact to them then we're going to be immune to the things that really do matter. it goes beyond your home car phone and computer though owner abilities were also found in airport scanning equipment allowing

hackers to potentially manipulate their vital functions security researcher billy rios claim to have. on the flaws into t.s.a. approved pieces of equipment it's hard to imagine chaos in the airports of hackers could take advantage of these flaws especially for a security system that's undergone so many changes since nine eleven. i don't know if anyone can cause right now but getting on to that quickly through that you can be prepared if it does happen it's something we need to do rather than through the hard way that we should have. while the list of potential vulnerable both big and small continues to grow researchers at black hat say prevention is key and should be the plan to focus on going forward in washington because they are cheap. you know aside from security and privacy concerns we also made an effort at black hat to get some perspective on the financial markets and tech industry as well now you heard a little from kate pierce a moment ago in bianca's report and she's

a security consultant. i sat down in vegas with her to learn a little more first asked her how well encrypted the new york stock exchange now as jack another massive market exchanges are today here's what you have to say. some of the stuff the encrypt is very very good some of the. optimized for other things . like easy reconciliation. and it's security is a business is a business cost and it's a business benefit of the comp you think of it becomes everything that stops you doing what you need to do. so there is that balance but. it's such a community at the technical level to it. to an extent the predictions are to go. on the in crowd with your prove to the various networks so if you're a financial who can get on this with network that's a problem. but once you're in a nothing to do. you've got a lot more freedom i want to switch gears

a little here and talk about women in the stem industries which is science technology engineering and mathematics now a recent study says that women account for only twenty four percent of those in the stem workforce so you know how do we encourage women into this field and stop discouraging them and i was very lucky in that i missed that discouragement because i transitioned gender a couple of years ago and until that point you know i was one of the dude walking around i was blending in to this sea of men and in my industry is even worse than steam in general in general is around thirty percent i see numbers at a fifteen percent for my industry and when you take out the people who are in management or in the softer jobs it drops even more but it's terrifying. so there's a couple things that don't discourage them when the girls it doesn't necessarily need explicit encouragement just don't. don't suit up as folks expect don't tell

them that they're not cool for doing that now the other part though is when they get in often the korea trajectory isn't they're not going to glass ceiling is they need to get on the elevator. so i've seen this with some my friends who are. in biology and academia where all the postgraduate students coming through are like sixty seven percent female but the faculty is almost exclusively male and we have a largely high me and the. board. maybe i'm just being paranoid but something funny there but also all too often i get people saying oh but it's all about me or it's all about me or well remember talk or see i've seen tends to devolve into an oligarchy you just mentioned that you noticed a change when transitioning into a woman so what are some of the more prominent changes that you noticed from the workforce in community i've been very lucky in that i've missed most of the worst

ones. most of the differences have been having to justify myself more having to. deal with not being pursued doesn't explode by walkin i have to prove myself in a way that i didn't have to previously and that is. frustrating but also a lot of fun when people don't expect that i slam them down and make them feel insufficient it's great you also mention that some people in the industry just presume that you're an h.r. or marketing no depending on how i dress you go out there walk up to any random got man and say so you want to go. but then again also if you have social skills i presume your sales and marketing if you know hiding back during. you must be going to suffer because if you were technical person you wouldn't waste time with it but people also use the lack of social skills as an excuse to be rude or to get away with things they would get away with elsewhere and that is very discouraging for one. i haven't been socialized to put up with that i have been socialized to accept it and so i don't i people find that jarring but i'm happy with my life i'm

not here to be pushed around by people who are being idiots dr kate clancy an assistant professor at the university of illinois recently published a study and if the statistics basically say that the number of women in the workforce or are being sexually assaulted more that statistic is going up and this is just yet another obstacle for women to have to face in a male dominated workforce and a male dominated byron meant like a job so does this problem deserve a thoughtful response in kind of similar to the way that organizations are trying to encourage young girls to apply themselves in science technology engineering and mathematics so partially it's there but a lot of it is also the nature of the industry of academia it's all about your networks the people you've worked with you need them particularly early career to boom your own credibility and if you they do something to you you want to a position of power sure you could you could take it you could push something. but

when you suddenly lose your collaborators. they can ruin your career even if it even if it wasn't explicitly because of that people just think you're making a fuss. and that's not ok. we do see that in other places too but in steam particularly the way you don't publish on your own you do work on your own it's always a group of people whether it's the people you work with directly or the people across the country or across the globe and you need to keep them on side. and maybe admin started getting circular so more they would actually start to see some change but until then we have to work out how do we deal with that in the same way that a lot of women publish with a first initial rather than a first name because then i don't have the gender bias in the same way that. this shouldn't happen but you see the same thing with resumes and studies where people see no reason why with mr or not or a first initial instead of a name and suddenly they get more coolpix you can't prove anything but the correlation is suspicious. that was security consultant kate pierce time now for

today's big deal. big deal time and i'm joined today by the wonderful mr and i'm a big deal you are the big deal you are a big deal now today we're talking about private prisons and here's the deal three major companies scope be a capital of d.s.m. and a communal insurance have made headlines for denouncing their moment i million dollar investment in the private prison industry now the move comes after an effort made by color of change a nonprofit organization pressured companies to day to day best from private prisons in light of exploiting men and women of color so we should corporations that you know operate in the public sphere like public prison systems be allowed to trade on public markets or is there a conflict of interest there i mean yeah i think it's going it's gross i think it's

because the because they're deciding on people's lives these prisons put people live a lot of people away for god knows how many years of their lives and they pressure politicians to lock them up longer to keep them in jail longer i mean the number of we've three thousand nonviolent prisoners serving life in prison in this country we have five percent of the world's population and twenty five percent of the world's prisoners i mean if we keep locking people up at this rate who's going to be left to wear the snuggies and play the video games no one who's going to wear the snow again this kind of wear and i guess i don't know maybe the companies that are getting paid for each prisoner they have it that's i mean it's terrible but it skokie i want to talk about them because they're an alternative asset management firm and they're based in new york city they have four billion under management and they have other other assets in there. management there are there in real estate they do other things but one of the most profitable sectors is this private prison industry so why do you think it's such a successful business model does it have to do with the fact that you know it's kind of like a recession proof industry when you think yeah there's stocks are doing great the

corrections corp's are doing great it depends on how you measure success right right now we're only measuring success with profit what if we measured success with the number of prisoners rehabilitated or the number of prisoners that didn't get you know didn't because there's more violence apparently in these privatized prisons and less rehabilitation in these privatized prisons so it depends on how you measure success maybe we should measure it on how the groups are by the present so there you go you want to know that we're talking about this because in singapore they still of corporal punishment where they're going to have cane and it's kind of funny i mean from a western perspective you're reading this in the paper you know so and so about six lashings but the receipt is a rate that is extremely low so for us to say it's barbaric to do this but at the same time we actually we. are not so we're going over there just wasn't but he would you say are stinkers cost wise it's very cost effective and you have the option to go to prison you don't have to but i hear what you're saying in the sense that like we find that so barbaric right locking someone up for their lawyer

for certainly all drug crimes is saying yeah. yeah it's depending on where you stand it can go either way no private prison companies there are more operationally efficient than public prisons and furthermore why is that and should they be more operationally efficient is it because they have the luxury of not caring they don't have a public they're not possible they're not they're not public servants so they're not responsible for the public's opinion do you think that's all right you know fish and say well dexter is a fish and. it's quite interesting i mean you know prison prison labor and john is a fish and i think that i think. you measure but yeah they're they're measuring you know. they're not trying to rehabilitate somebody they don't they just want to retain them like the number of prisoners a lot of states several states i think it's maybe nine have signed contracts to these private prisons saying they will have like ninety percent fill these prisons all at all times also if they show hotels don't have. time to say

we're going to lock people up for you that's incredible now finally i've two seconds left well thirty but i want to talk about wal-mart can you tell me what's going on there there was a leaked memo from goldman sachs you know about this so quickly give us a heads up and commander share this week tell us how rumored acted this way wal-mart is there you goldman sachs so that wal-mart is on the decline and should continue to be on the decline apparently they're losing out to two smaller more convenient stores and they listed dollar stores as one of them and do you know how crappy does their stuff to be to loosen up the dollar store like most dollar stores they have like repurposed ramen noodles and like stolen shampoo bottles you know that's what they. all use really pregnant yeah because an electrical cords and so you it's a full on them really i don't know how when you're on it is really fun you have to come back more often that is leaking out of her sort of almost every doctor's night every friday eight pm check it out it is truly awesome here on r t that's all for

now but please check us out on facebook facebook dot com slash mr t. and these tweet us at aaron aid at camp from all of us here thank you for watching we'll see you next time. a little girl. will show bush charm school just a few stick to the cutting board to make the most of the something that is. science flourishes in homes and we check out some. technology. dangerous here on r g we've done the future coverage. do we speak your language from those close programs and documentaries in arabic

it's all here on all t.v. reporting from the world talks about six of the ip interviews intriguing story for you to. live in trying. to find out more visit our big teeth. placed series of explosions going off in a society players play polo going to make news and you know like more efficiently changing every minute and. cut me the last noel. my a lot like the payment. think the same setting all time place cases most elite bloodstone players sometimes from nothing

actually play this season and simple challenge to look just keep up the story kids will be just getting to the safety of the stage again take a look at the tests the teacher was still. playing live. we think about why we think there are good. beaches. coconut palms gently swaying in the ocean breeze. in fact. white has a deep dark little secret a secret the u.s. government would like you can. threw away. the bolide everything.

the u.k. says there is now a severe threat to the country. as a growing number of britons set off to join the extremists in the middle east. ukraine we report. on the european volunteers who have decided to join us. and china seems to protect itself from us. more american spy planes.