nonstop catastrophes unfolding that's all part of hubris and bullying and just we're no longer associated much with quality and a lot of it has to do with hubris right as i said it's it's that we have so much power and we've weaponized trade and we've weaponized the dollar and here is the headline china is playing the long game says charles gave there's an old saying a wise man points to the moon and the idiot looks at the finger says charles gave founding partner in chairman of gave cow research tariffs soybeans and rare earth metals steel the headlines when it comes to u.s. china trade tensions but these are just tools or weapons of warfare and a much larger battle over money and sovereignty and china is playing a long game he said in particular he he points out the u.s. dollar has been weaponized and china is really playing the long game by accumulating gold by creating their own futures markets by prepping for this and a very quiet way this is an interesting historical moment for the rise of china is

here now and now we have a standoff so it's going to be interesting to see how the u.s. response and how the u.s. population responds or if they're staring at the moon or staring at the finger or giving the moon the finger you know that's interesting to see how the u.s. response you know the u.s. is a plucky group of rugged individualists that have come through tough times before and will see what resources can be pulled one of us through it well we have pulled through other stuff in the past and crazy periods in civil war isn't and mass of the salem witch trials and we you know the mccarthy era and it seems a little bit like that right now that there is hysteria in the elite class because they don't know how to deal with what's going on in the world in the meantime the u.s. dollar serves as the world's reserve currency and is used for pricing in trade by a majority of nations around the globe however americans have decided to weaponized . dollar gave stated making any transactions between 2 nations susceptible to u.s.

action or scrutiny this is a big loss of sovereignty for other nations he said and china's taking the lead in forming an alternative trading currency to the dollar we've talked to alison mccleod here and i think that he's right that it doesn't matter about the currency this guy charles gave actually looks at for example that you know that china's trying to price the oil and remember and that is not what matters what matters is settlement of the trade where the settlement to the trade happens and as brad sherman the congressman from los angeles points out is that the all trade settles to the new york fed and that is important it doesn't matter what currency it is the fact that it settles for new york fed is where our control comes from so that china has a long way to go to have a trusted settlement system and perhaps gold will provide more trusted right now as i mentioned in an earlier show you know we've seen this before in the eighty's with

the rise of japan and the us had a response they rejiggered the global currency markets at the plaza accord this was reagan in robert rubin the same people that gave us the plunge protection team after the crash of 1970 so china doesn't seem to be wanting to play that game though so they're going to have to come up with some other strategy and at the moment none appear on the fora isn't something is got to give either the u.s. accept 2nd class citizens in the global economy or they make some kind of dramatic move the u.s. could seize all the gold that they're holding on behalf of many nations and be the 1st to declare reste restoration of the gold standard because of course you know nixon promised that it was only temporary that would. then follow richard nixon on twitter and. i think if i'm reading the tealeaves correctly i think that's an interesting idea i think that could happen. but so we'll see you. what happens

there during the 2008 financial crisis we saw in russia with medvedev remember he held up the gold coin at the same time china was suggesting that they would prefer something like a bank or which is a basket of commodities and currencies but again you still have the underlying if you use fiat's currencies there is the distrust that goes with it as we've pointed out but here's another story that talks about this imperial rot and the hubris of the elite who they lose touch with them and vast majority of the population and you know they use the weaponization of trade they use the weaponization of their free out currency for their own benefit a very small group a and this is in baltimore and beyond a stolen n.s.a. tool wreaks havoc for nearly 3 weeks baltimore struggled with the cyber attack by digital extortionists that has frozen thousands of computers shut down disrupted real estate sales water bills health alerts and many other services but here is

what frustrated city employees and residents do not know a key component of the malware that cyber criminals used in the attack was developed at taxpayer expense a short drive down the baltimore washington parkway at the national security agency according to security experts briefed on this case so this is a parent with in 2017 the n.s.a. lost control of one of their weapons their digital weapons called eternal blue and it was a weapon that basically they weaponized a flaw in of course microsoft a microsoft product and they didn't tell anybody about it but this weapon this eternal blue weapon was either stolen or released by a disgruntled employee the n.s.a. still doesn't know how it got released but is wreaking havoc to the tune of tens of millions billions of dollars across the world but is now on domestic soil just.

mind boggling story and the malware that is the weapons grade and developed by intelligence agencies gets out there in the open and is used for a malevolent you know we often feared the presence of suitcase atomic weapons you know what havoc that could bring and meanwhile we actually have this suitcase portable all thumb drive version of n.s.a. corruptions. malware that is in the open that is causing havoc so it was released on april 2017 by a group called the shadow brokers again the n.s.a. doesn't know if it's some foreign power group of hackers or they're on their own disgruntled employees so it could be somebody still in that n.s.a. or whoever has this is releasing this stuff since that leak foreign intelligence agencies and rogue actors have used eternal blue to spread malware that has paralyzed hospitals airports rail and shipping operators a.t.m.

some factories that produce critical vaccines now the tools hitting the united states where it is most vulnerable and local governments with aging digital infrastructure and fewer resources to defend themselves so a lot of these local governments of course. or states they're near bankrupt after all these years is 0 percent interest rates where they have to pay off all these pensioners and retirees from state employees and local government and they are not earning their return so they have to spend more of their reserves but anyway they have old computer systems with old microsoft products on it that have they have not patched it because a cost money to patch and to protect yourself from this turn all blue so it's now costing tens of millions of dollars across america so i don't know if you know this is basically an investigative piece from the new york times so i don't know what's the follow up what's being done about this how how we're going to stop this like basically you know all these all these that they just need to patch it but i don't

know if they have the funds the patches or the know how to patch it because you know there's the thing of doing the patch but also you have to hire the computer experts to be able to do this across your systems i think there's going to be a big demand for old cars and old homes that were built before all this electronics homes now have all the smart systems for all the coal in the locks are all tied to it cars are all electrified electronically engage and they're connected to the infrastructure of the internet so that some of these old houses and old cars that are off grid completely in junkyards right now you know those prices are going to start going up because people to they don't want to be connected to the malware they have to get in 1956 chevy or move into a house that was built 30 or 40 years ago actually i'm going to cut through a little photo here max's new car see this is a 924 model i'm not saving enough chances on going back to the model t. because i know henry ford didn't put in any malware in that car no and of course

when google cloud went down just the earlier this week or last weekend. people are cut off from their nest their control system so they're boiling and in the heat of course this is also in the context of this battle with huawei crossing billions more. and yet the reason why we're battling chua way is that we're afraid they're going to put a back door but here the n.s.a. is releasing malware it's leaking all over the place apparently they don't know if it's a disgruntled employee or not or i've got a backdoor into my wigwam. i know how to defeat these people so before it leaked eternal blue is one of the most useful exploits in the n.s.a. cyber arsenal according to the 3 former n.s.a. operators who spoke on the condition of anonymity analysts spent almost a year finding a flaw in microsoft's software and writing the code to target it initially they referred to it as a turn a blue screen because it often crashed computers a risk that would tip off their targets but when it went on to become a reliable till used in countless counterintelligence and counterterrorism measures

now the u.s. by the way won't sign a global agreement that other nations want to sign saying that if you find a flaw like this if you find a critical flaw in the software use widely around the world like microsoft that you're supposed to tell that the company microsoft instead of weaponize ing it but we haven't signed on to it and this is the result well it sounds like a nightmare speaking of nightmares at this nightmare of the 1st after about the end because going to the 2nd half of all beautiful and shangri-la like with the brilliant guest constantine who's like a frickin genius don't go away stay right there more to come. this in petersburg international economic forum is a unique event in today's business world. over the last 21 years the forum has

become a leading global platform for discussing the key economic issues facing russia emerging markets around the world those of the business community members attend the forum to address to the use of lethal issues. or just special forum coverage on the. because the swarm see the blue of them so moment. sibylla viewers who are local was before. much of those who heard the preview it was few other movies to see him with the north we will we'll. move the bulk move when it's. all show you just look beautiful little i mean it's going to look or it would. move muslim also his girls will give you films for good girls. the british will say

look why do you disagree you believe this will explore the issue go. to startups to prove it to me to fill it with the littlest they'd say look it is it's. your stash them understand just move to the mashed old truck stop the president and please control this project until. those who have petitions to post this were to snip them little knew it because that is the cousin with you sir your supporters to your shoe station shouldn't throw you should cook door for one whose job is a wonderful story. welcome

back to the kaiser report imax keyser scott about to go to part 2 of our conversation with cosseting concertino welcome back and smarts so concertina parwan we were talking a macro scenario and by the way are over there at your new venture there macro view dot edu highly recommend people check it out now we're talking about the big picture macro economics trade wars tariffs and tromped all this stuff now during this period we've added interesting emergence of huawei chinese 5 g. telecom company that is definitely rattling people's cages and causing all kinds of hand-wringing and consternation around there tell us a little bit about what's going on there constantine well as far as my understand and use there is an issue of. art where from go quietly which is question in terms

of its but then szell ecuador's and oxygen and security apparatus in china. are where actual data flowing through the system well the specials the. communications the sun's on it seems to me that that is that you shouldn't use any sense of well that sense the from the geopolitical or the e.u. and. so economics matter it's clear to me that are both why we say if you want debate that is out in the west that the ease and warm. you up the siren you of china both in the united states. but part of this uncertain cyprus security is a huge importance area it is so remarkable it globally is one of the most the areas both. governments to date. at the wharf they're moving on to the rails a security environment we're looking at the cyber espionage but also. option off

operation is a is a sense of losses arising there in the star in one of the recent papers myself on the we have shown that there is outstanding results in the lower on the status of events in private sector. changes around the wall both changes where the company is that appealing foka by the police they are also beyond that. and i think dealing with now is going to be very problematic simply because yes alone that the chinese hardware and software. used by atlas are a power such as china in different instances and if i think violence in the phone case is against the targets in the united states and in the us. well somewhere that we were the ball for innovation is more along the bottom is the bodies of the states wealth of the world in which grade is beneficial exchanged both the actual

property of software and hardware people the development of the future network systems the communications networks in the united states and not exactly was the joys of the quality the penetration rates on the average. in the united states are very low compared to say for example europeans despite the united states being bought the major centers for in the basin lower than the nation that is attributable to the united states uk was a blow to the multinational corporations such facilities are on the wall china and chinese are up the chains of the quality of their research and development also coming up in terms of the quality of their academic results so in other words. you get out deal with the issues like why wait. in all it it isn't a mix in cybersecurity it isn't want to mix in martial security issues but also after find some. deal with it was out nixon and the ideas of jail for those for

confrontations and before. that. in the boss diplomacy. or development or investment and so forth operative solutions believe in the wall the forklifts of solutions will even in the wall block what with all the games the game of chicken wants you want to have on competition in the back of the wall it's very difficult model on the phone to dissolve the bond quietly. in the communication systems of the united states. radical radical or where it was disrupting the supply chain systems it was dishonest in the system. and it is dishonest to the potential for that american consumers that americans in general american system in general gave him the best possible to do in this war but on the

other hand is it warranted. then you know the solutions. all right isn't it. yeah i remember back in the 1980 s. when a similar situation in japan japan was starting to leapfrog the us a lot away and the u.s. came down very hard and this resulted in the plaza accord with there was a massive currency adjustment hadn't seen anything like that sense the brand woods agreement after world war 2 and now here we are china is kind of threatening us a gemini in the technology space and innovation and but instead of succumbing to let's say a plaza accord beat down you know china is putting out tweets of people associated with china than the government putting out tweets laughing at boeing laughing at the ability of boeing's technological difficulties the cracks in the fuselage is exciting openly mocking the u.s. so this is quite a different approach now it comes to artificial intelligence you know there's an

old saying that he who controls the gold makes the rules but it were entering the 21st century where it's really he who controls the telephony and the artificial intelligence is going to make the rules that's the 21st century and china's clearly leapfrogging ahead what you know and you recently you were talking about america's infrastructure as being incapable of supporting the middle class or the lower class you have people deaf a catering on the street you have an ability to pay off student loans you're creating a generation in america how are they going to compete with innovation overseas trumps trade wars seem to be the panacea attempting to write all these imbalances but he's even going after allies so the latest terror slapped on mexico to force them to deal with the central american migration issue tell us about that does that make any sense he's using that issue as an economic issue he seems to be mixing

everything. up in a grab bag of policies about a lot of. that's caught diplomatic sense your thoughts completely agree with you in that mexican pirates is a lot a case of the weaponization of trade their dreams with dogged by the economics of trade with mexico united states for its large number of aunts for the future as sam was so probably out of opinion for the united states transformed into iraq with words and quite often it's for the rest of the law. no message use multiple problems in terms of trade. there is a great partner for the united states in terms of faith it's also i would say great article the united states in terms of the ability a few months if you will with a drug free market for its muscle with you as you look at the what do you know the new does of the light that states when we get to the other side so the issue here is that the tree is. only still objects and in that kind of

living byron it's weird if look you see it. was wild to be thousands and the work you most states is doing and it's also very hard to see the united states and sustain its economic model bone for so on to france where the great issues with mexico are really very elusive was one of those is what happens when you bones that it's only a major 3 to part with the supply chains been intermingle the extent that u.s. mixes supply chains and really once a semi shooting rises with china what happens is that in the long run american manufacturers are going to bring jobs in america they to offshore jobs that appian offshore to say for example channel mexico somewhere else and that's a higher cost location on us because we're already in an optimal location gens of your cost for manufacturing what we're watching some says and then you are those 2nd best location which is a hot box that cost has been passed on to the american consumers but crucial

american producers of becoming less competitive as a result. and that's what you choose one to war in mom's you we direct in box in terms of the fire crisis but we will that's what the doubts on the hop in the long run in all schools will be any rush need to compensate for example for the time to balance in terms of the chinese are in world war 3. wise it's because in watching the united states most popular say for example jaunts like opera is offshore in there or production launch i don't see vietnam in florida have costs but the vietnamese for the action is owned by these chains investors so in other words you are still paying china well the production but you know how bean plant cost to china yeah i get it so you know it's a game of ever decreasing returns there are a reminder of the crisis happening in the global garbage market now know none of these countries are taking america's garbage anymore that's offloading back to

america right so that's ok that's why we have l.a. and we have someone says that we just dump it there right excellent point let me ask you about this we've got a situation right now one number sometimes can cut through a lot of a quarter tell us about one number and how it relates to all this the number would be a household formation constantine well a household court formation in the united states is follow and even more so it's falling on the demographic lines so in other words younger households that used to be formed in their late twenty's early thirty's and now formed in their early forty's and late forty's so as a result of that is that he just compared germs of the farmers look at americans under the age of 22 sargon still with their parents it's used and compared with equal interests if you should bear if i prefer watching what is proper the possible ts in the lead used or the 4 seventh's will stay around 40 percent they did in the

united states it used to be about 10 percent while it is. or for the same. reason that mani want what they call in italy they call a mama a problem want to be where you can no longer or for move because they won't or can't afford movement their social mobility. in the future they cannot as. much as the halls and their interests in terms of their development that reduces available they therefore stay in their communities where they really don't have much of a future in terms of their career progression and a very developed on their mones. loans and so forth it has a knock on effect with the promise across the current life cycle of the possible so yes. when you take out for example that there additional logic possible families the months the migrants in the united states will look at the want them

a profit if the marks it's the route he was warm holds the number of children is the line in terms of in those households. the age at which families start and have children and so forth is also a rise and as a result of that the relative education bond or this probably quality software was that that those. children were at the area just as the laws were on the rise this is one of the major blocks of the idea of the cycles that nation but that also meets and we saw all this is though it straight causes boards investment bonds weaponization of the u.s. dollar and the u.s. it's far on policies. because in the nation in the united states means interest in typically and intimately linked. in or feel the fact that from all around the world the largest are those the war the likes of yams or this wall they all rely on mock

national work force working not just the united states. also outside of the united states and artwork form in terms of consumption while we're in that the reason the oscars and we have limits of. the united states but also people who want the multinational open is appalled because all sponsors aside and once the united states the united states and the united states opens its software locally as well as a result that all of which are often what we do is also use loan so as ultimate wants to change and social media is changing over that period is not growing as well so that new solution in the market anything else that will need the united states crowds and more growth and where the unity of the people is no longer painful isn't it won't choose a. cost of attainder. website as macro view dot

edu thanks for being on the casa report thanks mark'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 gas cosseting macro view dot edu if you want to catch us on twitter it guys are important and i stand by. what is it calling to coin is magic internet money a new type of digital currency decentralized digital scarcity chancellor on the brink of 2nd bailout for a bank that's called the genesis block for reason calling a civil disobedience a source of optimism because i can't control my own financial death any it's just a new way of coming to consensus it's a game changer in the human history this is columbus discovering

a new world this paradigm shifting technology that transforms. economics and finance in a heartbeat the apollo 11 landing on to the max and stacey. join me every thursday on the alex simon chill and i'll be speaking to guest of the world of politics sport this i'm show business i'll see you then. nobody could see coming that calls confessions would be that in the spot the waist up wrongful conviction. had any interrogation out there what you'll see is threat promise threat promise threat lie a lie a lie the process of interrogation is designed to put people in just that frame of mind make the most comfortable make them want to get out and don't take no for an answer don't accept their denials she said if i were poor or a sad statement then i would be home by that time the next day there's

a culture on accountability and police officers know that they can engage in misconduct that has nothing to do with solving a crime. you know world of big partisan. lot and conspiracies it's time to wake up to dig deeper to hit the stories that mainstream media refuses to tell more than ever we need to be smarter we need to stop slamming the door. and shouting past each other it's time for critical thinking it's time to fight for the middle for the truth the time is now for watching closely watching the hawks. ah. ah.

thank you. thank you lately. it was nice. i. got inside to the wiki leaks co-founder to live this life in a high security prison in london coming up we got exclusive. video of. international monetary fund says mistakes were made when he tried to flee volage insane is economy admitting it failed to keep problems in the country goes deep into the decades of everest.