never well jerome powell is the chairman of the federal reserve bank of america and he did raise interest rates by twenty five basis points this week despite all the tweets badgering him from donald trump the president of the united states who is telling him he's going to sink the economy of course the s. and p. five hundred has had the worst. basically the worst december since one nine hundred thirty one since the great depression and everybody's quite upset the power put is much further out of the money than it was under previous fed chair's that's what hurts psychology miller tape back the investment firm in new york says how will traders possibly survive ast zero hedge right getting back to discussion about the hype of fed chairman during that time starting when volcker when interest rates the short term rates were in the high teens approaching twenty percent when reagan was president they've gone down every single year really culminating in janet yellen now this new fed chairman powell is in place and he's saying that we're going to go

back to well he describes it as getting rid of the put that the federal reserve bank under greenspan or bernanke or janet yellen they were constantly bailing out markets by making rates cheaper apparently powell is saying that he's not going to go in don't truck with that he's not down with that everybody was admonished him about raising raise the problem is that stock markets have been selling off we've seen the worst stock market sell off since one thousand thirty one for december. and people were expecting otherwise the opinion stock investors you have now been warning for the last time basically you can't taper a ponzi this headline reads with a record ninety percent of asset class is down for the year and almost half of the s. and p. five hundred index components and a bear markets hopes are first santa claus rally to save what's left of a terrible investment year and while markets may still see sizable rallies the warning signs are still all around us and they send a clear message the ten year bull market will come to an end and the investing in

trading climate is changing dramatically possibly for years to come of course it's only been a ten year bull market in equity markets in the stock markets it's been a thirty seven year bull market in bonds i.e. the ten year treasury yield has been sinking you mention under paul volcker right. there is one june of one thousand nine hundred eighty nine hundred eighty one when it hit twenty percent and it's been sinking ever since so this is the past thirty seven forty years as you see basically the entire global debt infrastructure that under pins our entire global economy you keep on rolling over debt so easily it's always cheaper and cheaper to roll over debt and here's the fed right now it's unable to even get that high without causing markets. to talk about much far stein in the second half you know of course he wrote plan a ponzi and he's been talking about this for a few years now and he was a bit early but as some famous financier i said i'd rather be

a day early then the day late when it comes to catastrophic market collapses or reversals in this case and yeah it's a thirty seven year bull market in bonds that could be over and if the fed now becomes an activist that is trying to bring some integrity back to money the u.s. dollar yeah interest rates are going to go higher and you're going to find that markets could easily get cut in half and still be in a long term seventy year normalize kind of appreciation schedule or you know well of course the fed needs to raise rates because as the markets start to fall apart they're going to need to go somewhere else so here this market watch headline was basically warning about all the signs are there that there's going to be a huge sell off you've been warned if you don't protect yourself you know it's your own fault they say that the other big warning sign comes from the very federal reserve that is faced with

a critical policy failure as attempts to normalize rates have run into a predictable wall low or high after all this is been the trend for decades now as you see like it's lower highs it's going lower and lower so you know we talk to nomi prins and she points out in her book collusion. the central banks activities in the united states have been joined together with the european central bank famously they went from hawks you know from the old bundesbank that was really worried about what the conditions were pretty world war two where they wanted to hyperinflation they were very hawkish have been for years but they too under mayo draggy have been massively printing money along with the federal reserve bank of course the kuroda over there in bank of japan is the most profit of them all and you put this all together the bank of england also money printing you have the global central bank globalist central bank just all this money printing but if it comes to an end but if it comes to an end then is should finally then you're going

to have a day of reckoning and that could be upon us and again you have said for years that you can't taper a ponzi and this is this the me me here a little attempt for them to do so to try to normalize rates to try to pretend that we're normal economy and everything is ok i think that's the important way to look at the word normalise is they're just trying to pretend everything's normal hash tag normal everything's going to be fine but in fact if they can even raise the rates to three percent you know where or how is it going to be possible to ever return to what used to be normal well let's let's talk technicalities here so what's happened we saw us in two thousand a crisis there was a credit freeze because credit had mutated from a normalized let's say curve where money's being borrowed in the three five ten fifteen twenty twenty five and thirty year to almost ninety percent of all money in the one two thirty day window so it's all been extremely short repo repurchase

agreements just twenty four hours borrowing so all the lending is in that very small window so you take the global economy in the hundreds of trillions of dollars of the debt and you focus it all in the overnight rate so that means if the short term rate even goes up one basis point zero one one hundredth of a. point you have the same effect as if maybe twenty five years ago when the ten year rate went up a whole point or two so it's it's a bad mutation of these markets and we've been warning about it mitch has been warning about a lot of people been warning about a mish sherlock's warning about it now looks like the day of reckoning could be here and a lot of people in the audience may not be old enough to remember the two thousand and eight crisis but it was preceded by as you point out the credit crunch from two thousand and seven they called it a credit crunch and remember at the time ben bernanke he and also alan greenspan his predecessor were saying everything looks normal and we're also seeing

a credit crunch right now in terms of the fact that say in december we haven't seen any bond junk bond issuance so that's a remarkable fact share buybacks have been at an record rate just like in two thousand and seven as well this it hasn't been this high since two thousand and seven when companies are buying back their own stock to basically make it all seem normal hash tag normal everything's normal that don't worry are a we're not crumbling the whole edifice is not crumbling and they're doing the same thing so apple has just thrown tens of billions in the fourth quarter third and fourth quarter into share buybacks and it's all just evaporated into the stock plummeted i think warren buffett one from the frying pan into the fire because remember he was an i.b.m. and then got out of i.b.m. one of the apple and that was apple position looks a bit wrong headed but you know the problem is in the sun a central bank land that you know that you can't possibly go down this path of

bailing out losers you know in capitalism if you make boneheaded business decision the market is repay shuras. credit or if you will and by bailing out banks that were making bad loans where there was a subprime loans etc for years and years and. you killed capitalism in america so when this thing now blows apart hope the lefties in america don't blame capitalism because it's in fact socialism the should get the blame because these banks socialized all their losses through the machinations of the government and the central banks and the socialism that's the. guiltier certainly bailing out the bankers was the bad decision a major own palace are calling him paul volcker probable her of course did not bankers he did not he did not feel bad when they came crying and begging and pleading and doing that sort of jim cramer thing to them the closest to that has

been alvira now billion of the bank of russia the central bank of russia and maybe he'll be as tough as she is but again it and turn it so this has tag normal making everything seem normal another story that you and i have been covering for the past nine ten almost ten years now and report has been the manipulation of gold and silver and people of course have always denied that that could possibly happen is a conspiracy theory because for every buyer there's a seller we've pointed out wash trading that the buyer is the seller and the seller is the buyer they pretend this volume and sentiment against gold and silver well you know j.p. morgan trader recently pled guilty to manipulating gold and silver prices and that he did it with the express approval of his superiors but now j.p. morgan faces potential class action lawsuit after guilty pleas by a former metals trader at least six lawsuits all making similar allegations against the nation's biggest bank have been filed in the last month of the new york federal court the cases could potentially include thousands of people who trade in the

precious metals market a combined k. second class action status would include anyone who purchased or sold futures contracts or an option a nine x. platinum or play team or comix silver or gold between at least january first two thousand and nine and december thirty first two thousand and fifteen the entirety of our reign of chi. report where we've been saying they were doing this everybody denied it we in particular pointed out was j.p. morgan tearing at and now it's all coming out the guy is pled guilty we had one trader john edmonds a thirty six year old broker at j.p. morgan former broker and now he's been fired and faces jail time but a member of crash a p morgan by solar and that was now been vindicated that had the world bought so over physical in the open market we would have put j.p. morgan out of business but they instead extended their credit lines and they were able to wiggle their way out of that particular constraint life masters was dumped

she went into the crypto business and she just left the crypto business so she's a little bouncing ball goes wherever the money is for a few months and one of these lawsuits is coming out of the civil lawsuits is coming out of westchester county and new york and that guy is leading the whole class action they're going to have against j.p. morgan it's been delayed the judge has delayed the case until after june and that is indicating that there's a department of justice criminal investigation into more senior j.p. morgan bankers so not only to have j.p. morgan facing criminal prosecution perhaps but you also have goldman sachs the other big one of the two thousand and eight crisis they're facing criminal prosecution and investigation from the department of justice for their role in basically defrauding malaysia an entire nation here john edmonds you know the thirty six year old trader who had pled guilty to manipulating and apparently he's

talking as well to the department of justice he's a new york resident he pleaded guilty in october to one count of conspiracy to defraud the market and manipulate prices of precious metals futures contracts and one count of commodities fraud in the criminal plea edmonds admitted that he and other quote unnamed coconspirators a j.p. . morgan fraudulent lee manipulated precious metals markets from two thousand and nine to twenty fifteen the same time frame covered in the class action suit right and you notice that the price of gold now is trading higher because you're removing the manipulator so it broke obama twelve fifty which is always been the line that j.p. morgan other banks have told their traders don't let the price get above twelve fifty over the past six or seven years you see the price of gold went flat even though the debt has exploded around the world those two usually trade together so now there's going to be a need for the price to catch up and so twenty five hundred on gold i think is a two foot putt as they say in washoe county. ledge by the way i want to point out

that you did have crashed j.p. morgan buy so we did that in two thousand and eleven here in price report but j.p. morgan closed all their short positions so you can't do it anymore that they had a massive short position which left them vulnerable to a physical delivery situation there was a golden one open but. you know we'll get on. jamie diamond's next buddy stay tuned for the second i have to go away much more. sad to say that it wouldn't be the first time that there are hundreds of millions of dollars if not billions of dollars that are lost in the pentagon so to be honest i'm not completely surprised that three hundred twenty one million dollars in refueling costs glenn missing i'm very glad that saudi arabia. emirates have now promised to pay that bill but i think there's no avoiding the reality that that

bill is actually being paid for by the people of yemen the people of yemen who died under saudi arabia's immoralities indiscriminate bombardment of the. i had a great education a good job and a family that loved me. i never had to worry about how i would eat somewhere i would speak. i'm facing christmas alone out on the streets of london. the glory like going to. the you know to sleep in the still give up food for the harvest. and then. i just.

feel. this is how the.

welcome back to the cause report i'm asking as are time now to move to fire stein welcome back match thanks max i don't agree to be here already so it's december twentieth and the fed has raised rates on my god they continue to taper the poncy are trying to do how is it possible what's going on just raising rates that they have room to make them lower further down the road i mean the federal reserve is boxed in these guys don't know what they're doing they're lying to everybody you know first they said that we were far away from neutral then they moved a quarter of a basis point they said we're close to neutral so what they're reacting to is the stock market they're reacting to political pressures they're reacting to the

massive amount of debt that's been accrued for the past nine years what caused the credit crisis too much debt too much credit too much leverage what they've done is pumped hundreds of trillions of dollars in liquidity and created the most grotesque asset bubbles in the stock market in the bond market in the credit markets and the property markets this is going to end in an explosive way max but we've been talking about this for a number of hairs really and they have this idea that they know better than anybody else that they can manage the economy they're bigger than the market they believe and so far they've been right because they have the greenspan put and they are nanki put on that janet yellen put now the power put who's to say they won't be doing this from the twenty years well the problem with what they've been doing is valuations at some point don't work anymore like you're seeing that people started rioting about two months ago in france they're burning the place down because basically the middle class has been squeezed out they've been priced out of everything so no matter what they tell you about zero inflation in the bank of

england lying about bragg's it to try to. force people into doing something that they shouldn't really be doing the european union is a failed project that can never last whether france drops out first whether italy drops. britain drops out that's finished finito that debt can never be repaid but the middle class has been eviscerated and what they were trying to do was bring in immigrants to replace the voters that they need to bring back i say see a direct link between the rising wave what we call the global insurrection against banker occupation that started almost with the revolution in egypt in cairo the arab spring and then now it's been occupy wall street was another harbinger of what's been happening right now and it's coming to a head right now so all the policies that were the problem then are still the the problem except that they middle class is getting squeezed even more than they've ever been and now they're getting more violent they know what the economist magazine would call social cohesion risk is becoming more pronounced but they you

know we know from experience that that doesn't sway the policymakers that people are getting knifed and burnt in the strait they're not going to stop right i mean so what does this go well it's a plutocracy so i mean the sooner that we realize that this is a problem with society and the wealth inequality gap has gotten to such extremes that you know you have no ford ability for housing any longer so you have to realize that the next crisis is going to be one of liquidity when valuations are somewhere in the stratosphere or beyond i mean you've got insane valuations you've you have trillion dollars b. companies threaten a billion dollars and trillion dollar companies that shouldn't be anywhere near that valuation so that means that these asset prices you've got massive asset inflation so this creates mega opportunity i see in two thousand and nineteen coming up i think there's going to be a lot of opportunity i think that the people who did the risk parity trades that were overcrowded people who bought the fang stocks have gotten their asses handed

to them i think all these guys in the markets that have been following the trend the momo traders follow the momentum follow the momentum are getting smashed because you've got kids who are been in the market for ten years. i have never seen a bear market i mean all that the central banks providing all this liquidity have done is prolonged and made the problem a thousand times worse when the politicians and when the people realize that they've done this they're going to react as usual too late but their history tells us that the plutocracy a will scapegoat the bar and they'll be a lot more tension and structural a society could break apart so the opportunity side of the trade. get sure you can short stocks and you can maybe go long gold but we are fundamentally talking about a collapse in society we i think i think that you have and i mentioned this a few years ago and i mentioned in my book you have

a couple potential outcomes you have civil unrest you have trade wars that begin as trade wars and they become eventually hot wars and then you have the possibility which is the worst case scenario of a nuclear war or world war three which is when you start pushing narratives false narratives against countries like russia when russia is not really the enemy you know china is the real enemy china has been taking advantage of the united states for the past forty years and china is the biggest potential threat of any country in the world to the united states as a money manager you've got to look at all these risks here risk analyst and you mentioned that in professor steven cohen is an eminent professor in new york university he just came out of the book talking about the new cold war between russia and the united states and the threat nuclear weapons being is now a higher level than it was in the first cold war and. how much of that is

being looked discounted by money managers at this point saying you know they're weak at what person what risk factor what percentage odds what is the professional money manager class giving to atomic war i don't think that's i don't think that's the distinctly significant process the. ability but he was saying if he would say that's a ten to twenty percent probability we go to atomic warfare i would sell the twenty percent i think that's way too high so i think you know i think that we've got a lot more significant problems and i think that what we've got to do is deflate all these asset bubbles that have been inflated and we've got to look as i einstein as einstein said you know the definition of insanity is repeating the same thing over and over and expecting to get a different result the problem is we keep we keep electing these officials that work on a pay to play basis and whoever gives them the most money is what they react to like i told you months back that oil at sixty five dollars a barrel was ridiculously high and i maintain that oil is going to go to a thirty handle or twenty handle i think it will still overpriced in the fifty

dollars range that we're in currently ok more on the economy and markets so the yield curve has inverted. if that's the case so is that telegraph recession it's an ominous sign and it means that there are problems in the market the market doesn't believe the the signals that the federal reserve is putting across the problem with the federal reserve is they've got to come out with a narrative that makes them look smart and people realize that they're a bunch of liars they are no better than anybody else they're not going to admit that our policy we've made policy errors for the past ten years with what we've done so they're going to have to figure out a way to deal with the mess that they created and there's not going to be one unless there's a major change or major crisis ahead which which will have to happen right right dahlia over there. his shop biggest as far in the world he gives the u.s. dollar to eighteen to twenty four months then sees a thirty percent fall comparing it to the turkish lira this is

a bridgewater right dahlia all your thoughts well i'm pretty negative on the dollar i think that you know people are going to when they have a panic people run to the u.s. dollar is that's the trade to do but if you think about. you know what i've been saying for a number of years is you're going to get the emerging countries like russia china and india that will come up with a currency that's based on exchangeable commodities like oil copper silver and gold not backed by a printing press that's on fire because it's absolutely worthless and people will say take your feet dollars and shove them because they're really not going to have any value i mean when you see pieces of art trading near what seven hundred million i mean this is rampant inflation and now you're seeing a global collapse in property prices so it took a longer period of time to realize what's going to happen but everything that i've predicted has just been on a slower time scale but it will happen because it has to imagine oil there is

a rumor circulating that there is a daily comic between russia and saudi arabia at a price of oil in rubles i think that's already happened actually i think i think that the dollar is ation of oil has already happened in a few instances and you know look it's a matter of time the reserve currency the u.s. dollar is been the reserve currency for one hundred years and before that the british sterling was a reserve currency for four hundred years ago there's a lot of pressure down saudi especially the current leadership regarding the journalists murdered and a lot of politicians in the u.s. like lindsey graham saying you know this is trump's indication that he has failed as a president and that's kind of pushing the saudis into the arms of russia at this point so i don't know that that's the case i mean saudis no friend of america never was i mean if you look at who was behind nine eleven it was the saudis fingerprints were all over have they been honest with us no absolutely not i mean that's another should be they all human i mean they say they way way that they don't want that

person etc they don't want an examination of that i mean they have to whatever their leisure was it was a good symbiotic relationship in terms of cash for oil escaping the cash and the world reserve currency the petro dollar that took over when then seventy one when when we would all. the goal here is there's the bottom line yeah we are going into a recession look at the yield curve look at what interest rates are telling us the forward the forward curve is telling us we're going to have a recession and never in the history of the universe when you have a recession do oil prices skyrocket i mean i don't know if you think that they're going to be able to manipulate the prices higher during a recession but that's just not going to happen and you're already seeing recessionary tendencies in the emerging markets the emerging markets are unraveling with their currencies depreciating and the amount of their u.s. dollar interest rate debt that they've got to repay is skyrocketing because their currencies are collapsing so it makes right surrendering to globalization dollars ation i came up with a star mayo mercantile ization do you think that's a good term because it just means you know it was done by lateral dale deals with

each other and you got of settle these things up you talk about a currency based on commodities that would be the currency mark until as a yes no i think that could work i mean i think that you will have a significant change in you know u.s. dollar hegemony will and i think it will end sooner than people think what happens is you know this is like i mentioned that you're slowly climbing up a staircase slowly slowly slowly and then you're going to get shoved down the elevator shaft because for the markets to come off they come off a lot faster than they go up it could take ten years to go up and then the damage will all be done in a matter of months and you know everybody thinks they're smart enough to get out of the way of a collapsing market but they're not and you won't have time because the next crisis is going to be liquidity driven all these momos will disappear and they'll be no bid for any of these assets anymore and then you're going to have defaults on mass my fear is more powerful than love and that's the story as markets firesign thanks for being on the kaiser report thanks for having already and that's going to do it

for this edition of the kaiser report with me max kaiser and stacy herbert like to thank our guests mitch firesign author of planet finds a way if you want to reach us on twitter it's guys reporting tonight by. i certainly don't expect that very many people will choose to be biologically go through a big biological will move your body isn't working for a while it also means your mind isn't working so well i believe that indeed we will have pretty much no biologically old people even though of course we will have a much greater number of cola between old people. well you know the fire thing we've kind of adopted because we were called pirates

for so long. i mean they're in this small ball of snakes in a hard pool of ships and it's. not something. the little self did big time fish already ninety percent of the dot and flown with connor. concept fifteen scoops seventy five tons and they do it several times a day with a big fleet so now you get an idea of why. we have to understand we can not stay still and just. be witness of the deal going on because our. i'm doing this because i want them for the future world to future generations to have and enjoy the ocean how we have.

to go vast sweep through paris again another round of anti-government protests police used tear gas to disperse crowds in a sixth. because if we kind of action as dozens of injuries and arrests all reported. i i. said on independence. leaving dozens injured in protests that a government meeting in the city which coincided with the end of a heavy police crackdown. and sacked for refusing to sign an oath to israel a school therapist in the united states texan authorities over

a mandatory pledge which has been forced.