backscatter this is the cause report you know tomorrow will be episode three of gonzo back to stacey traveling around the country because a documentary then me and we're going to be in san francisco and it's going to be awesome and you've got to tune in to watch it because so many people are you know want to go to work tomorrow and people say hey did you watch the reaction stacey gonzo show and you'll be like. oh you're so you don't want that to happen watch it . yes gonzo max and stacey it's a new series where in the third episode tomorrow at ten part series we're traveling from the west coast all the way to the east coast we're looking at transamerica seeing with the you know the mood of the america is right now and it's quite fast and tomorrow where in san francisco we talk to no no's only highways and then we head over to yosemite it's really fascinating so. part of the reason why there's so much meltdown in the fabric of our societies whether here in spain where you have

independence movements and lord knows what i think with briggs in the u.k. it's too ard to figure out and there's not enough time in the day to cover it and then you have italy you have germany now on the brink of recession you have france on the own and that's spreading the yellow vests well here's some information from the i.m.f. . is there a look at global debt and they look at they have some great charset should go to its new data global i.m.f. blog and they look from one nine hundred fifty eight till two thousand and seventeen and i find that global debt has reached an all time high of one hundred eighty four trillion dollars in nominal terms the equivalent of two hundred twenty five percent of g.d.p. in two thousand and seventeen on average the world's debt now exceeds eighty six thousand dollars per capita terms which is more than. two and

a half times the average income per capita right so the response here because we've reached terminal debt do loop that no amount of economic activity going forward will ever provide the tax revenues sufficient to pay down the step we're past the point of no return we've gone through the debt looking glass this means only one outcome that central banks will continue to print. to keep the interest going on the intermountain pile which means wealth and income gap are guaranteed to increase which means of the movement is going global and the global insurrection is upon us and that's a guarantee there's no coming what we are talking about is yes the central banks will continue to print and that is only going to make the matters worse because as we've pointed out the cantillon effect means the only way that the only way they've

been willing to anyway the central banks are only willing to give their money to other bankers they are not willing to give it to the people they have a newborn it's basically and frankly for the ordinary person in the u.k. there was a headline and a coverage from the new statesman where they looked at this data about how bad the retail sector has been there has been an absolute collapse and consumer spending and it's been blamed in the headlines on breaks but they look at the data and what it turns out is actually consumers have too much debt and not enough income their incomes have been declining for the past ten years so it's a simple problem but that the matter is that we have a corrupt system of the elites who are now scared and what they what anybody who is scared does when they panic is they start hoarding even more so here's another headline with some great information and charts and this is america's middle class is vanishing nearly half of workers earn less than thirty thousand dollars the u.s.

economy is booming republicans think president trump deserves much of the credit for cutting business and individual tax rates combined with a deregulation agenda and democrats believe former president obama rightfully deserves ownership for america's recovery regardless of who gets credit our newest visualisation of net compensation levels for american workers demonstrates that the economy is indeed delivering but not for as many people as the headlines would have you believe and this is. some great data they put together and i think they got it from the i.r.s. all that red section that's close to forty eight percent of the u.s. population they're all earning under thirty thousand dollars a year. this is the next segment and this is one point four percent little tiny chunk right there one point four percent of the population is earning over two hundred fifty thousand the pattern of generations living better than their parents. it is broken they used to be the story in

american history for one hundred years specially after world war two is that you would leapfrog your parents and you'd be earning more now for the first time really in living memory or in memory in america that's gone into reverse the people who are the retirees are living great compared to their children and their grandchildren and so with each new generation going forward the expectation is that they will be living a quality of life life considerably less they are living a quality of life as life they're living like lice for sure ok the reason why this happened and it goes part and parcel with the first one where the i.m.f. provide data about from one thousand nine hundred fifty until twenty seventeen the reason why they've we've no longer are able to live better than our parents is because we have hit saturation our parents were able to live better because.

basically we went off the gold standard and we introduced this global for the first time in history of humans and then we deregulated and allowed all sorts of debt so they were able they were first in our parents' generation were the first in on that ponzi scheme and first people in any pyramid scheme they always benefit that's that it's like m.l. them it's like you're you have to continuously get more and more people in on your scheme and you're doing better if you're the first one and only the first people in do well and now we're at the end of that and maybe it's all going to fall apart i think it will be because we're we're getting to the point where the millennial and the generations are bigger than the the first in on this pyramid scheme and they obviously they see the writing on the wall that they can't ever win on the. term their debt saturation because you're implying that there is a point of saturation but since reagan going forward the message that politicians. given us is that there is no such thing as does such ration the deaths don't matter

we can always create more debt but of course nothing in nature is like that you can never have anything grow out of control without any limit whatsoever that's called cancer and we have a debt cancer and it's definitely strangling the u.s. economy but it goes against the ethos of america and the whole idea of manifest destiny that we are privileged individuals and we have a destiny in the world and we're entitled to explore and go wherever we want without any consequences whatsoever i think we're at the end of this experiment i think it was a monetary experiment for the last forty five fifty years since we went off the gold standard the global growth standard so i think you're going to see everybody figuring it out all nations are figuring it out that's why you see the likes of china russia and other nations hoarding gold they're starting to stockpile gold and i think you're going to see an acceleration you certainly see in china of their massively issue there just like going deeply into debt so fast and so rapidly like

it's shocking it's pretty shocking pace of the debt accumulation in china so i think they know they is up so why not build real things like railroads and and ports across africa and asia for their future trade on a maybe a global gold standard or because this is an interesting point i mean you bring up let's explore that just for a moment so you're suggesting that china knows the game is up and they are simultaneously expanding their debt and hoarding gold yes it's kind of a game of chicken and they are always operate on ten fifteen twenty year horizons they're looking ahead so they don't really expect to pay that debt now they expect there to be default that is what i said a few like a year or two ago is i said that that's a good plan for the u.s. is if is if the jig is up and that this is going to fall apart why not a whole bunch of stuff why not build your frickin wall why not build all of this like mass transport all across the. before it all is going to default yeah ok

russia sees what china is doing yeah and they're hoarding gold yet they're paying down debt because they have a different model but they're hoarding gold if china is expanding debt and hoarding gold what china cannot afford to expend debt because they have one point four billion dollars and a huge army so they can withstand any attack from possible creditors actual u.s. dollars yeah because they got through the whole trade imbalance for the last thirty years does the world trade organization you can this model of of building up a huge amount of debt with a plan to default only works for a huge powerful countries like smaller countries who aren't that powerful and don't want to fight and don't want to be invaded and aren't ready joke if you owe the bank one hundred dollars it's your problem if you owe the bank ten million dollars it's their problem yes and i think those numbers are a little bit changed now those there's a dr evil by this. i mean so china owes the world seventeen trillion dollars or thereabouts and that's a problem for the world and this is terribly for china yes go try to invade them

like see how much luck you have trying to clone by the way we now the biggest owner of gold in the world and quickly i want to point out because i don't want to forget this they think they were watching our show to see if we pay attention to this and this is h.s.b.c. to pay thirty million dollars to settle bond rigging lawsuit in the u.s. h.s.b.c. has agreed to pay thirty million dollars to settle litigation by investors who accused eleven big banks of rigging the roughly nine trillion dollars government agency bond market from two thousand and nine to two thousand and fifteen so they've settled banks saddled and bank of america settled they basically. they don't know a bit liability they don't admit they have but they actually did this but they said they just don't want to deal with having to go to court so they're going to give these investors private investors not the government the government of course doesn't go after these guys but these private investors sued them for rigging the bond market so they by settling i think they essentially bit a guild well. well george on the former chancellor and.

h.s.b.c. and tim geithner worked out a deferred prosecution agreement before this particular incident and we confronted eric holder about that i recalled or so this violates the deferred prosecution because it said it's explicitly that if they were caught committing another crime that they would shut down in america this is just a civil case well they have the well because it's been kicked into the long grass of the civil courts and that's obviously a crime it's quite patently an obviously a crime by any jurisprudence standard so violated their deferred prosecution they're still going to be allowed to operate in it and america and that's the definition my friend financial terrorism thank you and just basic you have proved it again and so i want to say again in this the thing that so shocking about this is the prosecutors the people who are prosecuting the civil case said that the banks use chat rooms and other means to share price data and coordinate trading effectively functioning as a single super desk to reduce competition and profit in virtually every trade at

customers expense where is an antitrust case like this one where a large volume a smoking gun evidence exists at the pleading stage so it's not rare every single time we see one of these global conspiracies libel or this like they keep on they are so open about it because they know they're not going to get arrested they know they there will be no consequence for them the model for h.s.b.c. in all major banks yet keep every ninety cents of every dollar they steal and then they wonder why the economy is shrinking they want to wear their jewelry show they want to when people are giving tours of the highway well let's take a break and when we come back we'll have more.

seemed wrong. to me. because the ticket and engagement equals betrayal. when so many find themselves worlds apart. just to look for common ground. it does you no provision are going to want it. or not we. owe. you for your hydro alaska's buskers. which was as you know. anybody. that has been. so as you know you're not. you know. what i'm already but it was. a lot we're going to go with. this one up as well i must. get off on getting

noticed but those were the. people going to. listen to this whether. credible but you suspect that they're already yes equestrian in the. officer. to get up off the ground or begin to. sound the sounds of an mit. officer. switched to the away from the officer. who did a kind of lunge for the web in one. had been done. and. i never

saw any contact with. any kind of back to where they were back here again fifteen feet apart at this point. he's got three. welcome back to the kaiser report i'm max keiser time now to return to our conversation with alistair macleod of gold money full disclosure i have a few shares of gold money yea they also welcome back the kaiser report that's my passion max parity let's get into it alpha mcleod the u.s. stock markets stood alone among world markets while others are falling we have rose so why is this is the u.s. really so much stronger than the rest of the world out there no not really i mean you know you i think you are in a bear market the reason i think you're in the same reason everybody else is and

that is that the amount of money flowing into the financial sector throwing into financial assets is diminishing to the point where it's no lower than the rate of money flowing out of financial assets is really as simple as that having said that i mean nothing goes down a straight line so you get rallies you probably get contra rallies which could last months but i think the basic direction is bull market over the market started right now it's just a matter of the u.s. market lagging and that there is a global bear market in equities with. be part and parcel with the overall rise in rates right right interest rates are starting to move up on a secular basis correct out or just correct it's it's a number of factors i mean obviously the rates give you a valuation. inputs if you like into assets but the main point i always

make is that what really matters is where the money's going where does the money flow and if money is flowing on a net basis out of the financial sector the prices of financial assets as a whole are going to diminish is the simplest. right well a lot of people look through earnings they like the product. so they look to the business cycle and they look to classical economics and lot of people don't understand that for the past twenty five years with the birth of the illiberal ism and monetarism it's all about cash flow and the cash flow if it's interrupted you have move down so we we've long ago left the arena of fundamental analysis you know we're living in this imaginary world of currencies and it's a completely different ballgame i want to pick your brain on some technology issue is the u.s. tech shares have been decimated at the same time the u.s. has started a vicious trade war with china targeting a while way in particular how much of this is about wall way competing too well

with the u.s. tech sector and how much of it is real. i think quite a lot of it is is. you know competition if you like i mean the idea that. a u.s. tech company should be on really as times earnings to my mind as complete lunacy. i just don't understand why it is that we move away from as you put it you know the proper valuation basis except when you get into a financial bubble in a way putting that to one side there is no doubt that side america there is some very very good competition and particularly from china with far away and i don't think it's any coincidence that suddenly the intelligence agencies round the world are turning on our way and trying to keep my eyes of five g. which is the new mobile standard. hiway are i think at least as good as most of the rest of us any you know not here and eriksson's and all the others and the american

companies so they are a major competitor and it's in the interests of european and american tech giants to try and skype a. potential and of course you know you turn around say well way you know might be pushing spike ships in their equipment salumi typically you know everybody thinks well gosh yeah that's bad news isn't it so you know that but i mean we can actually believe anyone from government when it comes to these masses i think quite a way basically a good company and a strong in terms of technology but arresting the chief financial officer and trying to impede their business is i think quite a problem and i don't think it's doing american and chinese relationships much good either when it comes to the current trade talks but that's another issue well let me ask you for a reality check i've been throwing around a term here for

a while i want to get your thoughts on it what you think if i'm on base or off base i came. but this term of neon mark and tell as i'm that way with the globalization and the dollar as asian have come countries are going to be competing with each other kind of on a zero sum basis as we saw during a mercantile us period and we also see of the rising gold what you would kind of herald maybe going back to some kind of global trade subtle than gold is this is this a good overview of a transition period that we're seeing and with the way you describe the way it sounds like we're no longer in a world where all boats are lifted by the magic of central banking or going back to a more cutthroat competitive global competitive environment a more mercantile us the environment what do you think of that idea well i mean i think it's it's a valid description but. you know we've got this sort of situation where governments think they run their economies and so they're acting as you rightly

suggest smoke until it spent it got no idea about business i mean it's actually quite quite awful the way president trump seems to think that you know the trade deficit only arises because china competes some thirty don't it's not as dollars because he's engineer the most enormous budget deficit which you're all you know which least leads to trade deficit so the politicians who reckon that they're actually running a running a show and that being advised incidentally by big business is cruelly capitalism that's behind this. you know they're trying to sort of basically dis the opposition wherever that opposition is whether the opposition is internal from smaller companies which is the case in the e.u. incidentally whether it's you know from international competition right governments are not really known for their expertise when it comes to picking winners and doing

business sick etc and a hundred years ago or a hundred fifty years ago this was all reconciled with something called the gold. standard that kind of get things in check and now we've got the rise of gall they've got china stockpiling gold again and russia stockpiling galled and this kind of part and parcel of the earth you know their governments chaotic attempt to reconcile these trades will be at some point reconciled via the gold standard is that where we're headed well just to find just one back a little bit when we have to go stand it governments didn't intervene that much i mean they license banks expanded bank credit and that led to the you know the on crisis but you didn't have the intervention that you have now i mean you're certainly right to look at the parallel because if we go back to some sort sound money there's no way that government can intervene and print money to pick up the pieces but it all goes wrong which is actually the standard. method of government

intervention at the moment but i think the ghost story is getting interesting because i don't know if many of your listeners or viewers rather have aware of this but russia's output is increasing quite significantly i think earlier this year they announced plans to double their clocks and become the second largest gold producer after china and bearing in mind that china and russia are all working together in the go markets i mean this is this is something that is building up into. the monetize ation of gold i don't know what degree of monetize ation will have at the end of the day but there is a degree of monetize ation i think building in these it asia sort of on a transition basis masterminded by the partnership between china and russia and this is something that's very interesting because it's going to change the way we behave i mean we've already seen the eastern european countries such as hungry and

poland realize that they go to cumulate gold if they're going to keep up with their neighbors to. east so this is something that i think is you know we'll look back on it and say that this time the why in which these big countries are moving off the dollar moving towards gold as part of their american tillis plans and they are very most sure. i think that is going to be it's going to be if you like a turning point in history a slow one admittedly but i think it's i think it's happening so out there when gordon brown fall half of britain's golf hundred fifty dollars an ounce when he was . chancellor of the exchequer did you personally break down and start crying. no i didn't a lot more than. max is nothing i can do about it and i'm not you know i'm not sort of wildly british nationalists i don't i don't fly a flag in front of my house now that we're all called bugs on their show and they

you know i shed a tear for you bret you know i still have some empathy for ya'll over there and that place that what about this belt and road initiative that we hear so much about across asia and russia the u.s. is also pushing back aggressively against there so is this part of what we're talking about here it's anticompetitive behavior basically the u.s. has a watt a seat any of its global empire will the u.s. succeed in stopping at the thing. i don't think so because. president trumps make america great again is to become isolationist. that means that america's influence in the rest of the world through trade and all the rest of it is bound to diminish. she's running in the enormous trade deficits of course if she's a very good market for countries that run the montreal say slow to go tighten which is really what it boils down to. but i really think that america is losing it and i

think that you know that the big macindex story if you like you know the sort of the. all that geopolitics is coming is coming true and america are on phrase on the periphery she's losing a grip over the e.u. she founded the e.u. actually and she turns around and says the e.u. we don't want to trade with you on your. you think oh my goodness well what do we do it turns around the and says put more money into nato and i say well we don't want to do that we would rather have our own army you know so the whole thing is actually changing it's a time of enormous enormous evolution you know and not only prince wrote a book with a car collision we have a man a lap but i want to get your thoughts on this quickly talking about global financial banks actually cleared for the past thirty forty years what's your thought on that. idea is crazy because you know the way an economy works is that it's a random exercise people do things different things at different times and so

you've got you know the creative destruction going on as creative destruction goes on all the time now that is in a proper economy what central banks are doing is they're trying to get everything working at exactly the same time which basically means that you have it you build up a wave of model investments because they owe put money into the global system at exactly the same time and the crash at the same time because none of them say they're going to crash but they do they go crash at exactly the same time i mean at least if they crash slightly different times. but the result is that we will get swamped if you like. if you like a monetary tsunami which is a global thing which nobody can escape from central bank corner if it's not good enough out of a cloud thanks to rain on the cars or a part. that's my pleasure all right that's going to do it for this edition of the kaiser report with me max kaiser and stacy herbert like to thank our special guest allison mccloud from gold money if you want to catch us on twitter it's kaiser

report. when i came back from iraq oh mary i want to her was cocaine methamphetamine say anything that's altering trying to get us out. that bad mindset using a chemical that would be so. i want to be drinking and drinking ino new nope just killing myself. hollings drink to get drunk alcoholics drink to feel normal. that's why it's that's why a drug addict knew what a shock was still for the near. star cool under which these guys would bring through to it it just means to. reduce need to be hoped and not get pushed on by

the v.a.'s are as drugs go and stuff they need to be built. and either she really shouldn't be looked at like numbers they should be looked at like people if they go to a veteran center for health issues be considered as someone who really needs attention or. you want to make sure that the quality is not just a slogan of misery but it also is associated with the rise of the stuff that the believe how can you have a bicyclist on the. bike having people reach of saving investing. broadening increasing the size of the national park so that we can distinguish gold to everything. in twenty forty you know bloody revolution is here to clear the demonstrations going from being relatively peaceful political protests to be increasingly violent revolution

is always spontaneous or is it you still were here i mean your list put that you would put him in the new bill is that i mean you split needle the former ukrainian president recalls the events of twenty four g. and. those who took. invested over five billion dollars to assist ukraine in these and other goals that will ensure a secure and prosperous and democratic. takeouts and water cannon are called into action in paris is on the government yellow best stage for a ten consecutive weekend across france that's despite president probably launching

a national debate to placate the protesters.