with news independence referendum due to begin within hours police reinforcements raid barcelona madrid says it's managed to shut down most of the polling stations. the russian defense ministry says over two thousand and al-qaeda fighters have been killed in just the last eleven days as well as intervention in the syrian conflict paul says the two year mauled and. agro chemical giant

monsanto's banned from the european parliament off to refusing to attend a hearing questioning studies about its products. coming up next my colleague nicky aaron will be here to tell you about the top stories of the week but don't go anywhere because the report is straight ahead. how much cash or this is the kaiser report coming to you from the nexus conference in aspen colorado oh. well. this is a fantastic show today a great opportunity because an american scoundrel one of the world's most wanted

men a known financial parasite a man has commit untold number of financial crimes and misdemeanors who stolen from the pockets of american in the world citizens for years someone who we all have great antipathy for who i have compared to a parasite escaping the anus of a diseased. giant of st. louis. you know i don't want to disparage any individual person i think any anus will do in this instance. with any anus it doesn't have to be specific to any one person and there's this parasite jamie diamond. so mad. max we are still up here at the aspen institute and we are beyond talking about jamie diamond our moving on to the consequences of jamie dimon and the world in

which these sort of parasites and habits and create now this is from the bank of international settlements which is the central bankers central bank muted inflation a trillion dollar puzzle says b.a.'s the conundrum of stubbornly low inflation despite a pickup in global growth and continued monetary. similis is a trillion dollar question the umbrella body for the world's leading central bank said on sunday the bank of international settlement said and its quarterly report that cheap borrowing rates in the rare simultaneously expansion of advance and developing economies are driving financial markets higher with signs of exuberance starting to emerge but they can't figure out why despite all the new debt the inflation is not happening what is the primary mandate for central banks around the world is to have an opinion about inflation janet yellen echo these sentiments in her testimony when i asked jonah can you explain what's happening is inflation she

said no i don't know because i. i have no idea what's going on with inflation i mean i could tell me i sit around. all day long thank god to play the cosmos but i've never actually had a real job i don't know what the price of stuff actually is because i get paid to shut them up so that these banks you rolled that they gave themselves huge bonuses at the expense of everyone and everyone else out of the building because i don't think a financial terrorist. right. right . she doesn't know the primary job if i go to the barber and i say i like to buy haircut and he says well i can give you a quarter pounder with a side order of french fries i say that's not a good proper you know if i go to a surgeon i say i need a heart surgery they say well i think you should get a twenty foot yacht i say that's not a good surgeon if you're johnny own say wiser inflation she says i'm going to bury

him and i don't get any and. that's not a good central banker so here i have some possible solutions for. the conundrum i my be able to explain the puzzle swiss toilets caused up with nearly one hundred twenty thousand dollars in cash swiss prosecutors are investigating why two people tried to shove about one hundred twenty thousand. thousand dollars worth of five hundred euro notes down the toilet around geneva the bills were found in toilets at three geneva restaurants and an office of the financial company u.b.s. and may it's apparently to spanish women it's not against the law to destroy money there so they just did it for laughs. the toilet paper in switzerland is rough. that is true you know we are at a crypto conference and one thing that a lot of people will say where about bitcoin or gold is well you can't eat gold you can't eat big coin. but with fiat you can apparently it has

a right to use case has practically yes absolutely well look feel money i think the average lifespan of all feel money going back hundreds of years is twenty seven years they don't last a long time they have none of none of ever lasted they've never endured they've never been around for any length of time that's that makes any any impression on history whatsoever and once at all that gold is money gold and there are five thousand years no one will not take gold and that's true and up until recently we had no substitute for gold now we do with what bitcoin is a gold substitute you know and that therefore it's changing the dynamics of the entire market is changing the way that gold is used as a funding currency you know people don't understand why why doesn't gold go up ever why is it stuck there you know like a dead fish rotting on peter schiff garage door. wise peter schiff so angry frustrated. why why is peter schiff missing the payments

on his yacht why. why won't gold go up because it's uses the funding currency what i mean by that is that if you want to raise the money fast to go buy bitcoin or go buy some high yielding currency you can sell gold futures in the market then take that cash and you can go and buy something that's going to give you a real rate of return there's no risk in that essentially because if you have it all coordinated efforts by banks to sell to school teachers at the same time they will all be able to raise instant money the reason it always works is because every time gold trades down to you know it's called eleven eighty or twelve hundred or twelve thirty you know then there's an insatiable demand for gold people in india buy gold it's been there way for tradition for millennia there's always people talk about gold we talk about gold we talk about silver though i'm going to stop buying gold there's always demand for gold so it goes up ten percent and then the sharks demand they sell short they take the money and they go by quickly. well you know

but they go by a higher yielding currency they go by. the field and so what's going on it was so max let's go back to the story here claudio barrio at. bank of international settlements is not able to figure out why there is no inflation and here. because like you mention is dead fish he is surround he is in the fish bowl of his own central bank policy he is surrounded in switzerland by other bankers who are feeding off the money he's giving them here these two spanish women have so much money they just throw it into the toilet and they don't care about it they they did pay the damages for of the they did the toilets up with this money but here's another story that goes along with what the central banks who they refused so they're like they're like hillary clinton what happened what happened where is the inflation i don't understand people like me well here we see a chart insanely concentrated wealth is strangling our prosperity in one nine

hundred seventy six the richest people had thirty five million dollars each in twenty fourteen dollars and twenty fourteen they had four hundred twenty million eat a twelve fold increase which you would say ok fine everybody is making money some people are getting smarter whatever but the information that they're giving here is that the top twenty percent of wealth they spend just five percent of their wealth and you only the next twenty percent down spend twenty nine percent the next twenty percent spends forty two percent so if you know once you have seventy billion dollars it becomes difficult buy more yachts buy more house use control you forget how many houses you have and forget how many cars you have they're not circulating the money in the same sort of way but the thirty four trillion dollars between quantitative easing and fiscal stimulus has been created since the financial crisis

is over. going into the hands of people who can't even spend what they have that they're just dumping it down the toilet or this is going to understand about the reports coming out of the central banks who say they don't understand why they can't stimulate inflation because they are injecting into the economy trillions of dollars which you would think there would normally cause an event called inflation but it's not happening because it gets basically stuck in these reservoirs of bad on the banks' balance sheet it doesn't answer the real economy and for there to be actual inflation in the economy you would have to also have actual wage increases in the economy i've got nothing against. you know making rich you know capitalism makes a lot of people rich but if it was making people richer in the absence of competition then that's not capitalism anymore ok that's the best that's right that's right we're not going to do that i mean i'm all for it if i am a special relationship with the central bank to borrow money at zero percent interest rates and then i buy fine art of by half and shade which is why these

people are walking around like there's a bar sheet on your face if you can find the light and in any order roger varies but going jesus. we. can find the light so. what happens when i get certain reports from the b. i asked also this is the thing you were talking about contained a study that showed global debt could be under reported by thirteen trillion dollars because traditional accounting practices exclude foreign exchange derivatives used to hedge international trade and foreign currency bonds so that kind of fits in with these women who through one hundred twenty thousand dollars down the toilet here is like thirteen trillion dollars magically we found this thirteen trillion dollars there's there's so much out there. but to a certain just a handful of connected to claudio barrios to connected to janet yellen to to wall

street to the e.c.b. the ones getting all the free money it's not trickling down. the number that tells the tale is the blah city of money number if banks are not lending to small or medium sized enterprises then you're not going to get g.d.p. growth in any organic sense of the word and he will not get wage growth and without wage growth you will not get savings without savings you will not get capital and without capital you will not get capitalism capitalism requires capital which requires savings which requires a rate of interest that encourages people to save and that rate of interest has to be commensurate with the global more than the sky is america's risk reward profile and issuing bonds if i am a wall street bond issuer and i issue too many bonds then the market can absorb i should watch the price of my bonds go down i you know i just can't issue bonds of goldman sachs every day billions and billions and that they never go down in price because the fed reserve is always going to print money to buy them that's not even

remotely tied to capitalism in any stretch of the imagination that's a racket that's a racket and it's causing wealth and income disparities it's causing. the investment flow going into noncompetitive non-essential industries that mean there would be a vibrant solar industry in america if there were penalties meted out to corporations that were abusing the financial markets to perpetrate their legacy bottles like in the carbon industry i'm not talking about let's say oh is there global warming or not global warming maybe there is maybe there isn't but there should definitely be competition for alternative energy and how come they're being starved to death except for elon musk who gets because people think a dumpster thank you. ok well speaking of competition there's competition for this space right here doug casey is up next i've course competition is the key to all more competition lust monopolization that's what i say anyway we go to the second

half don't go away stay right there. right now we're in the. scene over. these birds fish you. he asked me who that might be yes a little bit sometimes yes. i could introduce you eat it is home to the wolves most powerful drug syndicate. why you groomer one tomato zarutsky yet get both is a big good deal of the pull grown people at the motley. fool nobody wants people.

to. know. most times the government knows what they do and they do nothing. welcome back to the guys are part. time now to go to an actual real live cryptographer charles haas concern of i o. h. k. going to learn a little bit more about that a moment charles welcome back to you know last on the iran you were launching a cereal yeah it was a great time that was an amazing piece of crypto history and history of course has

gone on to conquer the world practically but i want to talk to you about some other stuff what is iowa h.-k. so after a theory i decided to start a company with some i for some of my friends and i which case basically an engineering firm as well as a science firm so on the science side we actually were concerned about the science of cryptocurrency so we have research centers and universities we write papers and on the engineering side we actually construct currencies from the ground up all right so i get input output hong-kong you got it ok and you were recently spotted in connecticut hang out with steve cohen type fund manager what's going on here give us the inside joke so so ok you saw the picture steve cohen invited several people from the cryptocurrency industry to to his house to have a private party to discuss where the industry is going and where the value is. yeah and it's a private party. you know it was more of an informational thing and we had tremendously and we had a lot of fun and it was just mostly what is because of what is cryptocurrency what

are the trends you know where are the good investments going to be in three years to five years what technologies legitimate what technologies kind of fluff and so forth you know that was another big name in despair that has done business in the same area connecticut recently came out and encouraged people to buy gold because you know he sees trouble in markets and ten percent should be in gold and of course there's this gold crypto debate that's ongoing but what it makes sense for is fun to have exposure in a serious way as they would to gold into crypto you know that does make a bit of sense but the problem the market still don't have quite enough to have for institutional investors to come and i mean they deal with things with trillion dollar market caps and you know tens of billions of dollars of liquidity on a daily basis we're all queens and coin itself that doesn't have that kind of long but if you are small and you am like twenty five million two hundred million makes perfect sense to have that kind of exposure i won't tell show the details of the conversation but i will ask one question was there anything that he you dad was

specific to where he comes from the hedge fund industry that you thought whom i hadn't thought of that not going to comment nothing at all on the story ok fair enough you one of the loudest voices out there just saying i see your initial coin offering that are going on in the marketplace can you give us an update there so i see those are neutral things it's just a new mechanism to move between one entity and another entity and so just like when we had a color to movies or three d. motion pictures you can overdo it and so similarly people are overdoing this tool and so we see hundreds and hundreds of i.c.'s coming about they really don't have products they really don't have strong teams they really don't understand what they're going to do with the money or how to handle the money they just are in a gold rush right now and they say wow we can. get twenty million dollars or thirty million dollars and they're treating the act of raising the money as the end not just the means to an end so i'm a bit critical of when these things occur and i would like for purchasers of i

suppose to be a bit more careful and exercise better to do what you would there's a way to determine whether or not the token on offer is it would fall under the s.c.c.s. guidelines meaning it's a security or not and you spoke about this earlier but as of right suspect explanation can you review that again yes so basically the litmus test is if you can remove the entity raising the money and the ecosystem is still going to run for example if the assyrian foundation was going to go away and fatah like was to disappear if a syrian was to still operate then you probably don't have a security necessarily but if you remove the scented tea in the eco system falls apart then you have a quite a bit of centralization around it and maybe a security but these things are based on facts and circumstances and also the underlying utility and usefulness of the token and why people are buying the token so tell us give us an update because when you launched you know this area and part of the. case the use case of course were smart contracts and so where are we in the

cycle of smart contracts are smart contracts being used what's happening well we now actually know it's a real thing and they work and you can do interesting things with them it's now a question of scale ability and cost so what it's more contract does is it disinter mediate the need to have a centralized organization control and act as an arbitrary arbitrator or something like that so that's great but the problem is it's still not quite scalable and it's still a bit too hard to deploy these things in practice for most real life use cases like for example if you want to run a decentralized exchange or you want to run a big peer to peer lending some consortium or if you want to create a digital identity system but over the horizon the next twelve months to twenty four months we're seeing a lot of innovation occur that's going to allow these systems to eventually provide those services and eventually hopefully kill some of these banks and financial institutions. right now interestingly i guess you know you've transitioned into doing research so. why in other words instead of actively developing

per se you're looking at the research of all of this and how does that fit into your overall view of why is there a need obviously of doing this because you think there's a need for it so where did that come from and where is i going right as with all the merging fields usually you have a sudden innovation that convinces people this is a good idea but then innovation is usually stickley inspired in other words it's been created by an engineer not a scientist so the underlying thing to fix of why this works and what is secure what is not secure how do we scale of the things that are not quite solved yet so one of the areas we realized was vastly underdeveloped atrophied in the cryptocurrency space with the actual science side of it so we wanted to do is create a network of university partners and researchers and work with them so that we could write papers that would provide solid foundations for all projects not just a theory a more shares or coin but basically anybody who wants to know what is the secure

and ledger how do we scale how do we handle privacy these types of concerns let's give them strong theoretical guarantees let's let them guarantees go through peer review and once they have actually real scientists write these things as opposed to you know some twenty five year old engineer who came out of the a con family so you posit this between various tics and scientists right between engineers and scientists which which would include social scientists and sociological endeavors and looks into how these things are impacting our lives on a sociological level so how are how is crypto because crypto is permission less innovation it gives a tremendous amount of freedom puts it into the hands of people in a way that they have not experienced before it gives them sovereignty in a way that economic sovereign. the way that they haven't experienced before so this is a new chapter in our lives in our societies how is it impacting that we use seen so far already in war was that going in your view you know well first it's great to

intrinsically interdisciplinary so it's not just mathematics or cryptography or computer science you're actually right there's tons of social science components you know there's a lot of game theory that's involved in this it's a bigger question of incentives for example if you have a governance system where people have to participate in that system to vote and otherwise vet things well what incentive do they have if you look at the american election system for example very few people vote who are qualified and capable of voting because they get nothing out of it it takes a lot of time and they don't have really a lot of choice so they just choose to opt out well maybe in the conversation of what builds a good crypto currency and how can we manage it cryptocurrency use it grows and changes may be able to actually be able to come up with better systems to create social consensus among people and that's actually what we're most interested in is not just the currency side or the smart contract side but the whole banana of the actual governance side of things well this goes back to on a very profound way a very profound statement because typically the way people work out their

differences is to violence and through war and the us is got the biggest defense budget the world in fifty percent of all the tax money goes to weapons so from what i'm hearing you're saying here is that this is a potentially a way to change our thinking. almost a species wide level that maybe that's too grand but what do you think yeah well it's you know you've all harare's a great author and he's written many books and he says the world is built on collective fictions if you think about money and governments and corporations these are all just things we agree to be true even though they're just made up right so we're going through a big paradigm shift in the way the world is structured and watching technology is just another tool that we can use alongside the internet and other such things where we can start asking fundamental questions about how governments ought to work . how people ought to be treated how value ought to be flowed in what is the meaning of liberty and who ought to be in control and what we started to discover is a broad contrast where we now know we can do things better in the world yet we're still

doing things the old way which is resulting in civil s.s. for fisher and people going to private prisons and spending a lifetime in jail for nonviolent crimes as well as fundamental lack of choice in terms of our political system so no way of describing their sounds like a course load for a ph d. in sociology from an ivy league school which is highly expensive very costly. but it's within the capability of all humans to have these questions so why not give it to them on a frictionless almost cost free basis so that's what we're doing with cryptocurrency technology it's a real time when you can experiment on how to build better money and how to build better relationships all these scams all these problems all these things are happening in real time some are failing some are succeeding and every generation we evolve and get better and we learn more and this is common infrastructure that's open no one can control it nobody can coerce it it's just going to do what it does it's like almost like a second set of laws of physics in a certain sense but these are basically social physics so when i had jamie dimon

comes along and says because it's a fraud and keeps doubling down it's really hard it's really should like to shriek from a dying dinosaur a tarpit it's i feel almost pity for jamie dimon which is hard to believe but it's almost like a man is caught in a tar pit is already being eaten by an alligator screaming for his life and. because of my feelings for him i wouldn't ever help them but but do you share my thought on this you know i was on a panel earlier and somebody mentioned it's almost like the postmaster general complaining that email is a scam because you know we don't have stamps that we don't control it and i feel the exact same way i think jamie is part of a dying breed of business professionals that likes being in control of the way the world works and he's a bit scared that like the kings of old europe in one thousand nine hundred three the new century is going to bring many changes which don't bode well for his supremacy. i got to ask you this technical question here we've got about a minute what's the difference between proof of steak and proof of work so proof of

stick is like synthetic proof work so the idea is can we get all the theoretical properties and all the niceties that proof work provides but pay none of the energy costs can we simulate mining in a certain way that's all it is basically and so we've created a protocol called world wars which is quite well thought out but there are many other protocols like casper and tender mint and so forth but they all have the. same goal do the same thing mining does achieve the same level of decentralization that mining has but pay none of the energy cost and also pay none of the co-ordination costs and so forth and has a comment on what well actually or bores just went through peer review we submitted and was accepted at crypto seventeen so we went and did a great presentation we're in our sixth revision for the white paper and we have another paper that we've just submitted to a larger cryptographic conference and will be deploying it probably in a product it would just potentially be disruptive to the mining scheme which well it's like saying if you can drive across the country and you don't use any gas it's

the same deal here you know mining cost something to do something about proof of stake. destructive order of magnitude reduction and the cost of running the algorithm so the answer is yes the hard part is if you told steve biko i know we've got to get obviously not going to answer or anything i really want to know so i'm going to cut this interview but anyway. we're out of time so i was actually being on kaiser report thank you so much max it was a pleasure. well that's going to do it for this edition of the kaiser a part with me max kaiser and stacy herbert i guess i guess charles hoskins and i owe h.k. if you want to reach us on twitter it's kaiser require intellect time by oh. there are some nazis in the fifty it's not the mass of the a fifty

voters but you know saying that our culture of atonement. oh remembrance of nuns nazi crimes is wrong that's too much it's the attitudes of some people in the gay of which by the way is no in the process of tearing itself apart. in the us a child can choose an army course in school. with a retired officers as teachers we don't. recruit we'll sisters if the cadet is interested in going in the military but we don't crowd ourselves. the pentagon is funding a program to boost interest in the military among teenagers. to step out.