in the in the back again financial illiteracy if they knew they were the words you know people can hear the words coming out of their mouths you know this is not a vacuum we know what they're saying and we hear that they're financially illiterate and morons well i don't think it's financial literacy or economic and literacy i think it's just a complete failure to understand basic humans voters people like they live in a bubble where of washington d.c. which is a true genuine bubble of ideas and ideology but also economically here a thousand dollars or even fifty bucks in some guy's pocket is changes their perception of the world around them and that's just the simple it's so obvious and simple and like bill clinton got it i don't understand why these people can't get it it's just that people don't care about the deficit the republicans have been saying that over and over and over but they you know the fact is the ordinary person doesn't care about that as long as they have money in their pocket as the

washington post says here it had polled abysmally amid forecasts that some voters will pay higher taxes in years to come and the democrats believe those polls just like they believe the polls they hillary somehow despite the obvious absence of any you know passionate support for her they believe the polls that house still she would miraculously win here they believe the wrong polls that people would be against these tax cuts but all you need to do is put fifty cents in their pocket and they feel what fifty cents on the news again to put fifty cent in your pocket. fifty cent in your pocket is happy to say me what's going on here he's a seem like everywhere this guy now i get it so look the money in your pocket is very convincing you know you got a thousand bucks i remember when i back under reagan i was a proofreader in a rubber stamp factory and reagan changed the withholding tax and i got an extra fifty bucks in my paycheck. eric and i are probably trying to check so you get paid

every two weeks and i think going to wow and i remember very distinctly my coworker this lovely black woman who was looking at this my coworker and. there's more money for her any more money for you honey something to that effect. paraphrase of course but you know she was the real for today but i was there all the other for the mit people want the money there and so this could be a you know throw the traditional midterm election theme a little bit make it more unpredictable than is usually predictable but there's another one which is the tax cuts have hit a lot of homeowners and places like new york city and san francisco well ok they're normally not going to vote republican anyway but you know pending home sales tumble to a three year low as housing crisis worsens so pending home sales fell four point seven percent in january this usually takes

a while to trickle through but the point is that. you know the largest private land owner in the us. the landlord is blackstone group so since there's been a lead to recovery in housing prices since the crash in two thousand and nine but most of it is gone to the likes of blackstone group and if you look at that house prices actually saw a great chart from i think it was the financial times that price an s. and p. five hundred actually house prices have been declining so it hasn't been performing as well as s. and they've been underperforming the stock market oh my god blackstone what arbitrage opportunity you have wrought selves i suggest you short yourselves of borrow money into you viscera your own corporate balance sheet and then blow your brains out on live t.v. they gave us all of the kind of fun experience for the financial predatory class. well don't go away much work coming your way after the break so stay right there.

both the united states and russia have announced their nuclear weapons posture both countries are in tree a new age of war the age of hypersonic weapons we now in the new arms race. are you economic war is unfolding in the realm of education the right to education is being supplanted by the right to access educational loan higher education is becoming just another product that can be bought and sold but it's not just about education anymore it's also about running a business and what you're good models of the regime could it's also the truth i mean that literally couldn't be. what is the place of students in this business

model for college i was born now and i'm extremely bored education the new global economic war. welcome back to the kaiser report i'm ask eyes are time to go to wolf rector of wall street dot com out there in the bubbly asked of our mobile market san francisco walt welcome back to the guys report thanks max for having me back all right well if you're right that markets are still in denial about the increasingly haka she said what do you mean by hawkish fed and how are markets in denial about the so-called hoggish there's wealth well first we have to explain that hawkish today doesn't mean hawkish meant in the early one nine hundred eighty s. when volcker. interest rates one hundred basis points and one meeting

and then the next meeting regimen of one hundred basis points i want percentage point each that was hawkish by any definition what we have today is a a fed that raises perhaps. four times in an entire year so one percentage point in an entire year and welcome would have done that in one meeting so the definitions have changed a little bit but. the markets are until very recently were penciling interest to rate hikes this year and even though the fed has been saying we're not going to be three most likely they have been several fed governors who have recently opened the door to four rate hikes. powell and his testimony before congress added to that chorus he opened the door to a fourth rate hike this year the markets are still not ready for that four rate hikes mean it means that mortgage rates are going to be about five percent by the

end of the year maybe closer to six percent and it means that the ten year yield for the u.s. treasury market would be in our. in in around four in the four percent range and it shuffles the cost of borrowing for companies and for four hours holds so this has a dramatic impact now this doesn't sound like a lot of people you know thinking whoa whoa corrosion interest rates to one thousand percent well this is not going to happen this time around but they are rising and. you know markets have especially the corporate bond markets of completely blown it off they're just have not reacted to to the rate. environment yet but they're going to they're you can see the first the first indications that they're getting the message and which you were talking about the yield on the investment side but for corporations it makes it barring more expensive and he

makes credit harder to come by for companies that are junk rated so it tightens up the financial conditions and it'll take a lot of the credit enthusiasm out of the market all right well to put this into historical perspective as you mentioned back in nineteen eighty paul volcker was a hawk and he raised interest rates up at one point at a time and we got up to the mid teens on the interest rates and but as you point out if in fact we start off at a twenty five percent fed funds rate and that rate goes to one percent or two percent that's a four to eight hundred percent rise which actually on a percentage basis would be greater than the rises under paul volcker and this would cover a much bigger pool of debt so the question therefore is. if in fact inflation genie is out of the bottle and the i.s.i.

manufacturing days just had a thirteen year high of sixty point eight percent in february it indicates that inflation is roaring back the fed has always told us that they can. take those toxic assets off their balance sheets and return them to the marketplace without causing all kinds of market may have is that possible wall. i think it's important to realize what the fed is trying to do and the fed is trying to tighten up financial conditions which means raising year olds which means by definition falling bond prices so the fed has also talked about the elevated valuations in the stock market certain fed governors have talked about price bubbles in commercial real estate which is back before trillion dollars in debt that are sitting on the banks hold and that. commercial mortgage backed securities

are or are backed by and so you have various fed governors look at various. pricing or valuations out there and they're discovering and that's died and i study and i have a gun that discovering that after years of key and zero interest rate policy that asset prices have gone out of whack and so they're purposefully trying to lower them that's what that's what it means to tighten financial conditions make make it harder to borrow money bring valuations down a little bit and so they're you know that targeting asset prices with us and that's just by definition so the question is that you asked whether they can do that whether they can low asset prices without causing a lot of mayhem in the markets and i don't know you know it i think the plan is to do it very gradually without made him so spread it out over the years that's why

the interest rate hikes have been so slow this in this cycle extraordinarily slow and you know biggest i know that asset prices are way out of whack and they know that there's this huge amount of debt out there at all levels governments in a simple government corporations consume us and it's very difficult for for these entities to digest high inches. traits and everything has been picked on near zero interest rates so i think that trying to create a soft landing for markets and our history in trying to create soft landings is very spotty so i'm not sure that they're going to accomplish a soft landing or that it's going to be some other landing. right you know the history of the bond market going back to again to nine hundred eighty was the beginning of this twenty six twenty seven year bull market and bonds interest rates had ban on balance going down for twenty six there's two generations of americans

and people around the world have never known an environment of falling bond prices in a big way and rising interest rates in a meaningful way and they central banks including the fed are trying to engineer something that is in my view it and possibility because they are going to signal to this massively over leveraged global bond market and stock market and asset markets that are controlled by trigger happy hedge funds with hundreds of trillions of dollars that buying power at their disposal that they are going to ask them not to panic sell their bond portfolios in a rising interest rate environment that's absurd of course there'll be a panic sell of bonds of course they'll be a bond crash in the very near future if the market thinks that rates are going up to the levels you're talking about i think the question we have to ask ourselves is

when will the fed choke every single time the markets come down in a big way the fed has backed off and they've become accommodative they've given wall street what they want more free money remember this is a global ponzi scheme that we live and engineered by crooks at the central banks wealth how much of a bond crash will we need before they capitulate and say boss stuff we understand we have no control of the situation and wall street is our master would be a twenty percent fall twenty five percent fall in the bonds before they roll over and play dead once again wolf i think we can look at it as a model so or will cop. in two thousand and fourteen the price of oil and and then came damn by two thousand and fifteen and two thousand and sixteen energy companies small ones were going bankrupt and their loans and bonds were defaulting and credit froze up and and the lower rated spectrum of those energy junk bonds year old

spiked over twenty percent and companies that needed to roll over that debt meaning their bonds came due in the material they had to pay him off and they couldn't raise any more money to do that yes so they went bankrupt and so credit froze up on that level and this is when the fed came out and said we're going to stop you know your member of the december to force on you some a two thousand fifteen hype their rates the first time and so when this whole thing with credit froze up in january two thousand and sixteen for these energy companies and it started to spread a little bit to other sectors the fed came out and said essentially we're going to stop these hikes and they started flip flopping big time again and. and that was in essence every action to the bond market not to the stock market you know they're really worried about credit freezing up in

a credit dependent economy and so when that happens though that will back off to some extent now they didn't lower rates back then you know they didn't change that insta restart key all they did is stop raising rates and so this could be the model if if junk bond yields blow out and created freezes. across to create a company and they having trouble raising money you know you've got triple c. rated yields and above twenty percent it may very well be that the fed will say ok we're going to hang on for a while financial conditions have tightened enough that's what they want to do is tighten financial conditions but not too much you know that's what that means iowa . well if i mean ok the credit freeze and energy market they've backed off and there was a credit freeze in two thousand and seven two thousand and eight that caused the global financial crisis and they backed off and they bailed out the creditors and

not the debtors they're in the pockets of the banks and although they stop easing money as you point out their friends in other countries like the e.c.b. and bank of japan open the spigots of money in a huge way the net global growth of money supplies been increasing year over year over year and the debt to g.d.p. of the world is at skyrocketing levels of three hundred four hundred percent global debt to global g.d.p. hey this is an enormous ponzi scheme there's no escape from this enormous ponzi scam the best they can do is try to scare the market into not crashing a little bit but look out is that's impossible nobody nobody's going to be able to is to talk cancer away there's a cancer in the market you can just ask it to walk away and not attack the cancer is over leverage speculative jihadi financial terrorist with too much money to speculate on these bond markets and the fed has nothing to do about it they're going to and i fight they're going to a gun fight with

a knife role how they're going to do you honestly believe that they're going to be able to manage this exit from quantitative easing without a catastrophic bomb collapse and we have about thirty seconds and then hopefully i can stay for another segment well i certainly hope so because when there's a catastrophic on crash there will just restart the whole mess all over again and it will make this situation worse so my wishful thinking is that yes that will be able to engineers some kind of acceptable ending and spread it out long enough to war you know companies that have good created can survive it and that the zombie companies are allowed to die off yeah well that hasn't been the history so far there is no zombie compass. that has been left behind every single insolvent bank whether is j.p. morgan h.s.b.c. b.n.p. in france or deutsche bank in germany has been allowed to operate as an insolvent institution purely on the largest of the public's free money anyway we gotta go

thanks for being on the kaiser report here. all right that's going to do it for this edition of the kaiser report with me max kaiser and stacey i would like to thank our guests well fred terror of wall street dot com if you want to write to us on twitter it's guys report that i stop by i'll. say that. something is good in kosovo oh but phobos. but fall for. a whatever. i did the principle is good or the principle is bad has to be apply equally and that is.

why you go shoot when you can you know not to tell you the truth none of us are no good morning and one million people don't. even. now know winced from tooling a few pennies around and that's. in

the middle of the sixty's there were thirteen million students enrolled in higher education in two thousand and fifteen there were two hundred million in less than fifteen years there are expected to be four hundred million to overachieve. you hold liberia to. leverage your border and. while the demand keeps growing university tuition fees skyrocket the world over the cost of education is high increasing. their. work harder was more. i don't understand how can a school be a scam. in the name of so called economic pragmatism and as a result of international competition universities are turning into huge money

making machines. that in my family members went to university i think i wanted to be i wanted to be got one. from shanghai to new york paris to berlin countries around the world reflect trying different moves each remodelling its system in its own way but at what price and who profits from it. really are at the starting point of a story which begins at the end of the ninety's. at that time you have this financial izing itself all the while expanding many intellectuals european university presidents and expert groups engage in a vast reflection on how to build a more complete more ambitious europe. how to strengthen its intellectual

scientific and technological influence. what is the secret of the united states and its economic power. the answer lies in higher education and research. a realm that has become undeniably strategic. at the end of the twentieth century american universities prevail andrew europe is afraid afraid of finding itself on the sidelines it needs a strategy and so european gauges in a series of reforms to make its higher education more competitive so it can serve europe's economy its productivity its job market and its liberal project england

will quickly set the tone before anyone else and to get straight to the point. after the second world war we had a system where local education authorities around the country were responsible for providing a grant to students and giving of covering tuitions. and that was at a time when roughly three percent of eighteen year olds went to university around twenty thousand. all science students will for their first two terms be required to attend lectures on physics chemistry mathematics and biology it will also be possible for science students to major in philosophy knowledge is not bullshit look at what a huge mit were run in one and covering all sides of all all places. in the one nine hundred eighty s. and nine hundred ninety s. there was a funding crisis amongst universities lots of vice chancellors complaining that

they didn't have enough money to cover the amount of students are now coming through the system so the government commissioned a report and this was called the daring report and that came up with a number of recommendations almost one hundred recommendations roughly half for the government about how it could. maintain sustain and improve higher education in the u.k. and one of the most controversial parts of that report was the introduction of was i in one thousand nine hundred seventy the british left led by its young charismatic candidate tony blair wins the elections after eighteen long years of conservative rule. at the age of forty three the head of the labor party takes charge of the country with a program whose foundation is to apply private sector management models to public services so as to make them more efficient more productive route higher education

will be no exception. right. we need to widen access to universities get more money into universities and the best and fairest way to do it is a balance between the state and the graduate. fees became reality and nine hundred ninety eight and it was a key landmark in the history of higher education in the u.k. because at that moment the principle of free education free higher education in the u.k. finished. for this historic reform tony blair introduces the yearly one thousand pound tuition fee a smooth way to start five years later prompted by his second term election tony blair authorizes universities to charge tuition fees up to three thousand three hundred pounds yearly and tony blair. head of britain's labor party successfully passed a reform that the conservatives would never have dared bring forward. in two thousand

and ten the labor party rallies the opposition the coalition made of liberal democrats and conservatives led by david cameron take charge of the country very rapidly the debate of a jewish visa rises on the political scene again this time the government intends to authorize tuition fees up to nine thousand pounds all the while reducing the portion of public funding and it catered to universities this new reform violently divides both members of parliament and public opinion the have been very difficult choices to make we have opted for a such of policies that provides a strong base for university funding which makes a major contribution to reducing the deficit and introducing a significantly more progressive system of graduate paper and stuff we inherited and i'm proud to put forward that magic so this.

order. there is nothing a bank that tiny benefit to the lowest income graduates that justifies doubling or tripling the debt of the vast majority of brides isn't it credible that the party opposite who actually introduced the principle of graduates paying and thank you for two tuition fee increases is able to drum up quite so much they can drop the issues out there was any young person ask any young person in any poor communities in our country what is your prospect what is your what do you want to do many would say i want to study i want to qualify i want to go to university i want to achieve something in life. less they are very poor or they're going to borrow money to survive to get through university they simply will not do it this decision matters so much to

so many people. i'd say to the house if you don't believe in it vote against it was to the right three hundred twenty three you know most of the last three hundred true god. was i. was when the church was really from three thousand it became one thousand pounds i was up to the university i say wants to introduce nine thousand pounds a maximum face or anything between six thousand and nine thousand and one surprisingly most university decided to set nine thousand pounds most students we have now half a million students going through every year most of those will be paying

a minimum nine thousand pounds a year and that's stuns. over the course of fifteen years british politicians are ruling class that had enjoyed free access to education inflicted a paying system on the new generation. british students along with a european fellows now have to deal with these new rulings that's the way it is. they're young they long for a solid future that thirsty for knowledge and dream of climbing the social ladder all that has a price tag and they'd better get used to him. and they took her up in a working class family in the south of poland the young woman could have enrolled in a university in krakow in copenhagen or even amsterdam. it would have been free in england and it was granted a student loan to pay for her nine thousand pounds tuition fees. i

knew i was going to go abroad to study and i think well for a little while i thought it was going to be scotland but then. i think i decided it was england you know like way back and it just stuck with me and i and i came here and it was it was scary it was so scary because i was away from home i was here alone i didn't have anywhere to turn to and look at me now i study chinese of all the costumes that i could have chosen i can't wait for you know what the future holds and when i'm going to do i have so many ideas but we'll see. i talked to my grandfather once and we're talking about everything you know and then kind of started talking about university and how much money that costs and everything and i had many thoughts about.