that is a federal reserve bank fails you then enter a currency collapse you enter a hyperinflationary you know better as well in type currency collapse and of course the american ego will tell you that that's impossible here in the land of the free home of the brave you know empires come and go ok let's look at one thing i want to point out that we went off the gold standard in one thousand nine hundred eighty one so in a way i don't blame anybody who runs america for just doing this because why not people are sending you their real goods and services for free essential so why not rack up these huge debts plus we have to rack up huge debts otherwise you can't maintain the us dollar is the world's reserve currency so if the rest of the globe based on us sending all our manufacturing sending our wealth overseas in order for them to grow the economy globally to grow trade globally to grow the only way that can happen is if we send more and more dollars over there and the only way

we could do that is to consume more and more of the stuff and send them these dollars in order to maintain that exorbitant privilege saw us basically end up going off the us gold standard going bankrupt the world kept the sharod the charade going and here we are at this point that we've. all this fake debt based on fake currency so why not yes you know it's a question of the just all the you have been going to charade references i am. you know we should just do this entire show you can charades at one point and see how far we get into theirs but there are so many words because i lived in the u.k. for so long there are so many words i get to and i get into this like kind of conundrum like what do i say the british pronunciation of sharod or do i say charade like an american would say so i get to that point i kind of lose track of what i'm saying because i've got to see. either the british way or the american

midland to kind of you know x. . x. and with the pope pope pope of verbiage now the only thing that would have been better if you're racking up all this debt did it's never going to get paid back but it's based on a fake system anyway it's all fee so why not build better infrastructure why not build high speed rail across the country from chicago to norland from you know miami to detroit from new york to los angeles want to do that and get the you know overseas patreus because you know we know from history the car manufacturing lobby doesn't want to have high speed rails or trains to interfere with their car a lobbyist. by the way the way you describe there are foreign governments needing to accumulate dollars exciter that's of course the trip and dilemma which folks can look that up on google and find out all about this interesting chapter in economics

the trip from the lama so let's move on to the next headline is kind of related to the first one said that the u.s. paid five hundred twenty three billion dollars in just interest on all their debt that they've accumulated is something like twenty one trillion dollars since the founding of this nation and it gets faster and faster every year well here's the u.s. budget deficit and that gets added to the debt from previous so this will you know this is the national debt is accumulated over the past two hundred years the deficit is every year how much you're adding to that debt here is the u.s. budget deficit eight hundred ninety eight billion dollars topping forecasts us budget deficit widened to eight hundred ninety billion dollars in the eleven months through august exceeding the congressional budget office forecasts for the first full fiscal year under the trump presidency the budget deficit rose by one third in october to august period from six hundred seventy four billion in the same timeframe a year earlier the treasury department said spending rose by said. one percent to

three point eight trillion outpacing revenue gains of just one percent to two point nine nine trillion revenue from corporations fell to one hundred sixty three billion down by seventy one billion from a year ago i want to point out that's close to how much jeff bezos is worth so that's all that is given by corporations to the u.s. government is just one hundred sixty three billion dollars annually i won't get into how much we the citizens have to pay but it's a lot more than that. well it's apartheid it's american style apartheid this is a remake to that show love american style and they should make it apartheid american style. families that are stuck paying all the taxes and having to borrow it twenty percent versus the people running the ship are worth billions and pay zero for the money they're borrowing that's interest rate apartheid as a part of american the stuff we mentioned in the previous episode that jared pusher

pays zero percent in tax and because he buys commercial property which gets to he gets to write off all the taxes gains as personal income i'm going to turn to another headline to show you the mentality of how those wealthy stay while thing get wealthier versus the rest of the population because this is a remarkable story with some remarkable basically quotes here from the people pushing this program thousands i'm not for a zero downpayment subprime mortgages magdalene altered or lost her home to foreclosure during the subprime mortgage crisis but this week she was first in line at a four day event in miami where borrowers with poor credit were offered no downpayment low interest rate loans the event is one of several being held in cities across america this year run by the nonprofit boston based brokerage neighborhood assistance corporation of america or naca bank of america is back in the program with ten billion dollars they're offering fifteen to thirty year fixed rate loans which at four and a half percent which is below. market rates that

a subprime borrower normally be able to get but the difference in this program is that investors can't be they can't be investors they have to live in the home so in terms of the mentality how the risk get richer and the poor stay poor get poorer here's a quote from the guy who's putting this on like i said his name is marx mr marks from. people have skin in the game in a real way the people that walk away are higher income people who look to home ownership as an investment just like buying stocks and bonds working people look at their investment in home ownership for their family for their neighborhood for themselves so he's saying don't worry people aren't going to walk away from these mortgages like they did in the last financial crisis because the last financial crisis was caused by investors who don't who look at their home as a way to earn money and speculate and get rich or these people these poor people that were given these loans to are just looking to build you know they're not

looking to get wealthy from it there's just looking for community and things like that that's how they end up getting poor and people speculating and rigging the system and playing this system get wealthier old wine new bottles you know it's propaganda of course the this is the it's different this time i mean this is the famous old saw on wall street this time it's different the banks are engaged in fraud on lending practices as they were in two thousand and eight as they have been for thirty years as they get caught and as banks pay massive fines whether it's wells fargo j.p. morgan or any of these other credit facilities are. the laws are changed to make it no longer illegal to make fraudulent loans this of course will create huge credit crisis once again and the banks will get bailed out and the people who are engaging in the speculation with these fraudulent loans that they're unfortunately having to . sure we'll get wiped out but the thing about it is we know from history that

people continue to make babies and as long as babies are born the banks of customers to rip off well again like i don't blame the us for going into a huge amount of debt because they have to in order to maintain their exorbitant privilege of having the us dollars the world reserve currency like they're getting stuff for free so why work hard and try to actually pay real money for the stuff people are willing to give you for free here these people are will are able to line up and get a four and a half percent thirty year mortgage unlike the subprime crisis when they had those adjustable rate mortgages that suddenly went from having a five hundred dollars a month mortgage payment to two thousand so they're not going to get that here they're getting free money and they get a house so the worst that could happen is they get to walk away in two years or three years when the property market crashes there's no reason why they shouldn't do this it's absolutely makes sense not to itself this basically i think they're providing some greenwashing for bank of america because it's under

a neighborhood assistance program and they themselves get three thousand dollars per mortgage that they filter through this system the other thing is look at this main stream media this is what they say is different this time than during the subprime crisis remarkable another big difference today is the housing market itself home prices have been rising strongly and there is a critical shortage of entry level homes for sale for barbara finds themselves in financial straits it is far easier today to sell the home quickly altered or remember the woman i said mentioned at the top who is applying for one of these loans is confident she can make the low monthly payments this time around a small price she says for something far more valuable i think a home ten fifteen years from now that's an investment she said home ownership is freedom. and willing to go on record and predict the these loans from bank of america with them to. and for months they will discover. something they didn't

see that the loans actually there's a contingency that they become invalid during certain credit events like rising interest rates or something like that and a crisis will ensue and bank of america will say we had no idea we couldn't see this coming out of this up and we don't know and then they'll get a bailout and this poor idiot woman will be homeless in a shooting up smack on the street in san francisco somewhere wondering what happened what happened is interest rate apartheid dare you live in an apartheid state and you're on the wrong neighborhood you live in the bantustan except it's a four percent anyway speaking of bantustans we've got to take a break and let me come back much more coming your way.

to. put themselves on the line to get accepted or rejected. so when you want to be president. some want. to go on the press which is what the four three in the morning can't be good. i'm interested in the water. gave america a lot of new job opportunities i needed to come up here to make some money twenty five thousand dollars as a teacher or i could meet fifty thousand dollars a year. so i chose to truck people rushed to

a small town in north dakota was an unemployment rate of zero percent like gold rush is very very similar to gold but this beautiful story ended with pollution and devastation a lot of people have left here i don't know too many people here in the slowdown so much they lost their jobs got laid off the american dream is changing that's not what it used to be. and it's a tough reality to deal. was the job of the school was coming. back.

welcome back to the kaiser report i'm max kaiser time had to go to blighty talk to alpha macleod of gold money dot com the credit cycle is on the turn that's the title of his latest report at gold money dot com and as always full disclosure i do own a small business and gold money out there welcome back to the kaiser report and lou max all right so i've read a lot of your research over the errors and occasionally you hit one out of the park with that's a baseball expression by the way for you brits might not know what i'm saying this is really a seminal case this is a very major piece you've put out here the credit cycle is turning interest rates are rising they have been falling for over thirty years alister you say the cycle

is actually turning so tell us about what indicators do you see is this really happening well the best indicators obvious and that is they can't really go below zero i know that they try to put it blows zero but i mean that's a little nonsense. so you know. so the first thing it can't really go any lower after the next credit cycle the other thing that worries me is that if you look at the rate of inflation in america it is very understated we all know that c.p.i. says something nice three percent we believe it but actually if you look at you know a costard basket of prices is closer to ten percent as independent nationalise said and there will come a point where when bond you start rising when the fundamentals behind the dollar suddenly are accepted as not being actual good for example you go to a trade deficit running to well it's going to get up to

a billion dollars trillion dollars. and that's a trillion dollars of net selling of of the dollar also the foreigners already end the. dollar i mean i this is on us figures they already. twenty two trillion dollars of interest if you like of which four korean dollars seventy four trillion dollars is cash and that was in the middle of two thousand and seventeen they will have more no that is for sure what's being driving the dollar has really been the interest rate differential between. the euro you borrow in europe the interbank races minus point three percent something like that you can. borrow at three months by u.s. treasuries virtually zero to two point two percent you go to two and a half percent strip to take out of that you geared up ten times because that's the quality of the asset that you're buying and you've got twenty five percent only

money you know what's not to like about it and that basically is what's been driving the dollar nothing else really i mean this idea that. the u.s. economy is absolutely marvelous and it's going to be good for equities it is it is strong the u.s. economy is strong because there is a huge deficit driving it there is an awful lot of course going into it this doesn't happen elsewhere this is created the distortion when that distortion unwinds in the dollar starts falling then i think you'll find that not only is the dollar forming but the foreigners no longer buying u.s. treasury debt and under those circumstances. you use long the ok will continue to rise and rise substantially and then we ask the question what is the rate of inflation in other words what i'm saying is there will come a point where people start thinking very very differently now we know the rate of inflation is closer to ten percent in st sent so what should interest rates be

watch of the union new year's treasuries be so you can see how we can rapidly from a low interest rate environment into a high rate interest rate. environment and that's basically my thesis all right well let's look at this you know using what i would call the coloring book. you know analysis of broad stroke so you talk about the credit cycle turning which would mean that credit interest rates start to move higher and of course that's a big negative for bonds and that begs the question why now because over the past five or six years major financial pond and surround the world have called for a top in the bond market and they've gotten it wrong year after year after year and so why why now alister i mean if you're right you would be the only guy in the world to get the timing correct and i'm talking about the smartest guys in the

world have made this in miss they call it the widowmaker you know the absolute horrible they've gone short bonds way too early so why now al so what what is it what are you seeing the timing why now schwab seems no basically because you along the u.k. has gone up very substantially in the last week or two and if you look at the ten year it was usually about three percent is it ran up to three point two two percent of the tail end of last week and backed off a little bit the moment which show you no one can understand but when you get moves like that along that you. start undermining assets and particularly. news and this is something i think that nobody wants to see but you know the relationship is always the same you get you know bombs feet first able to speak second properties then. and so is the financial assets that is the problem that we

face at the moment and i think that we're going to see high use in the bond market that undermine will. in equities and then of course that starts spreading into the underlying economy people start looking at their business plans and they think oh a minute we've got interest rates rising zero our racial assumption in terms of return on capital to go to revise those we're finding that costs are rising input costs are rising faster than we thought we didn't expect them to really rise very much but they are definitely rising we're not making any money on this new plan we've got for making this which it will that which it so you can see that suddenly business starts turning round and being less optimistic and then starts cutting back on planned operations and it's at that point at the backstop to get worried what i'm describing is that is the chassis end of the cycle and credit cycle develops i get that right we live in an era starting with alan greenspan and

continuing through ben bernanke janet yellen and perhaps the current fed chairman and central bankers around the world that are huge to the orthodoxy of what became known as the greenspan put and that is the say activists central bankers who do not respond to cycles they simply keep plugging markets with fresh money when ever there is a danger of a bond market move down so what would stop the central bankers around the world who recently expanded their balance sheets by trillions of dollars the u.s. went from less than a trillion to something like five trillion on their balance sheet the e.c.b. has got trillions of euro's on their balance sheet that's sucking up all these bad bonds and preventing else from rising what's the say that we won't just have another round of maybe quantitative easing four or you know a massive bond purchases by central banks to the tune of fifteen or twenty trillion

dollars worth once again like what stops them from just doing more of the same alister. well all i can say is dream on the problem they face is that you have got pent up price inflation building time and this is why i mentioned the fact that the way the. c.p.i. is cost is it is a sort of evolving bosket designed to reduce the a current rate of inflation there is going to come a point where people begin to think hold on a minute this is not right the rate of inflation price inflation is actually far higher as the official statistics tell us and when they get hold of that idea basically the idea that you could if you don't print money and get out you'll get out of jail that way that is no longer an option because of the inflationary consequence is that you don't talk all that money that's being printed the last ten

years ok so just summarize that a bit so in other words we know what's been going on and we now also now that the modus operandi day for allowing this to go on has banned the misrepresentation of the actual inflation numbers the c.p.i. numbers they are constantly adjusted through what are called quote donek adjustments except margaret thatcher was big during at this back in the fatter era she famously would recalculate how inflation was calculated that was carried on now a sense that that's a reagan era and so this idea of inflation being at two percent is a complete false lead is saying it's actually closer to ten percent but it's hidden because you have the ability through mass media etc to kind of hide this fact but so you're saying that the ability so the crux of your argument is that the ability to hide inflation has run its course and that will trigger a reversion to the mean correct yes i mean the another way you could put it funnels

simply is that you can prove anything you want with statistics except the truth and the program. this people will wake up to that very to the if you like the reality of that very simple a right so just walk us through what this means in interest rates rise how will the financial world around change in a way that we haven't seen in more than thirty five years so what walk us through you know what actually happens your average guy suddenly you've got a thirty five year trend reversing bond prices are now on the way. down instead of up which is different than the past thirty five years to how to how does this reverberate through the system well the first thing that happens max is that bond you start rising substantially and governments have difficulty funding that that debt they will be behind the curve as it were when it comes to funding and you find

that debt auctions will always be disappointing so you've got higher high you still have equity markets going down and down and down and the general her crisis will gather and that will happen at a time when actually impossible in fact it will be impossible for central banks to print enormous money just chop money at the problem like they did. during the lehman crisis so this crisis is going to do very very difficult different if you like from from the lehman crisis so we're looking at a world where we run into inflation and the inflation is going to continue and that is going to continue to be a problem and that is going to be the root of undermining asset values and particular use where there is a lot of borrowing supporting the prices right we've got less than a minute and there we're going to have a on for another segment if that's ok but in the remaining forty seconds or so let

me tell you what donald trump recently said he said the fed is crazy for raising rates your thoughts well is a politician isn't. you know i mean everybody you know they don't like high rate but the fact of the matter is that the rate has to be appropriate for the conditions and i'm afraid mr trump is indulging in wishful thinking and incidentally there is a convention of politicians do not interfere with the central banks in the management even though you and i know that they tend to screw it up because they don't understand criticise fair enough all right also rob another segment forthcoming but thanks for being on the kaiser report does my pleasure max all right that's going to do it for this edition of the kaiser report with me max keiser and stacy herbert like to thank our guest alsa macleod of gold money dot com he thought to reach us on twitter at kaiser report until next time.

ran out of the flow the best out of the jewels with. the high says it's a pain to perform i had to actually prepare myself to die. he did what. i was sorry trust me i. was not so. slow in homo stuff her clown. squinty rose. and he had the goods sewed on. so we'll see him getting. more traditionally if it was that he could with us the. yes get deep machine. education

a couple hundred twenty b.s. get. a job. join me everything on the all excitement and i'll be speaking to us of the world of politics sports business i'm show business i'll see you then. make this manufacture consent to step into a public will. when the ruling classes protect them so. when the final clear you're around to listen to one person. we can all middle of the room see. the real news.

i've been saying the numbers mean something they matter the u.s. has over one trillion dollars in debt more than ten white collar crimes happen each day. eighty five percent of global wealth you longs to the ultra rich eight point six percent market saw a thirty percent rise last year some with four hundred to five hundred three per second per second and bitcoin rose to twenty thousand dollars. china is building a two point one billion dollar a i industrial park but don't let the numbers overwhelm. the only numbers you need remember of one one this will show you can't afford to miss the one and only boom but. prosecution will

need to become almost. a softball designed to take on where you push us off the threat of fines. by the number one place you do i mean yeah i mean i mean did our political pressure on that go do i need him called to know through security jenna's finance one hundred bundled up business models used by american corporations. he's sold them could be mental disease as you use the controls on the scene and the solution. lies up in association with the potato. i know who can he sell sometimes it is just maybe his ability to maintain an investigative documentary. ghost war on oxy. to seventeen years of war in afghanistan the country is stuck in a vicious circle of violence elections assassinations and reconciliation talks with

the world around afghanistan changing the country be able to escape its bloody cycle. this hour's top headlines here on r t the mayor of new york croutons of multiple mail bombing of times targeting various us democrat politicians as an act of domestic terror while donald trump reacting to the incident lashes out at the media a polarizing america. the media also has a responsibility to set a civil tone had to stop the endless hostility. from the. faces accusations of aggressive lobbying after reportedly do using fake bomb of groups.