united states was suffering with banking panics in the latter part of the fleenth century, banking panics in the united kingdom were quite rare. so the bank of englandort of set the pace in some sense. it was the most important central bank and it helped establish the practices and approaches that we still use today. now i need to talk a little bit because it's less familiar about what a financial panic is.s sparked by a loss of confidence in an institution. and i think the best way to explain this is to give a familiar example. how many of you have ever seen the movie "it's a wonderful life"? well, less people are watching christmas movies than they used to be, i guess. well, one of the problems that jimmy stewart runs into as a banker in "a wonderful life" is a threatened run on his institution. and what is a run? well, let's imagine a situation like jimmy stewart's situation before there was any deposit insurance. no fdic. and imagine you have a bank on the corner, just a regular commercial bank, first bank of washington, d.c., and this bank makes loans to businesses and the like and it finances itself by taking deposits from the public. and depo

now normally a central bank with a gold standard only keeps a fraction of the gold necessary to back the entire money supply. indeed, the bank of england was famous for keeping a thinned film of gold. the british central bank only kept a small amount of gold and they relied on their credibility to stand by the gold standard on their own circumstances to -- so that nobody ever challenged them about that issue. but if whatever reason, if markets lose confidence in your willingness and commitment to maintaining that gold standard relationship, you can get a speculative attack. this is what happened in 1931 to the british. in 1931, for a lot of good reasons, speculators lost confidence that the british pound would stay on gold. so just like a run on a bank, they all brought their pounds to the bank of england and said, give me gold. it didn't take long before the bank of england was out of gold and they didn't have the gold they needed to support the money supply. and then there was essentially -- they essentially had to leave the gold standard. so there was a lot of financial volatility created by this attack on the gold standard. there's

and george osborne and mervyn king saying we're in king is ben bernanke is equivalent of the bank of england and he likes to sit back he doesn't have a flatulence problem he's got a gastrointestinal problem that's his contribution to monetary policy around the world and he blabbed a few things to some so i club but he's basically in the financial repression game keep interest rates artificially low so that grannies you know the new george osborne budget it takes more money five billion pounds more from retirees and pensioners and puts it into the pockets of cliff the krauts in the city that's on top of the forty five billion pounds that almost born in cameron engineer the first from pensioners and grannies into the pockets of speculators who if you're a barclays h.s.b.c. or the old lehman brothers all they're doing is buying cocaine and shove it up their nose that's all they do a friday or saturday night go to some people in the see plenty of bankers all their back making snorting cocaine well let's look at these facts here because the fact is here you have the pilot of the economy of the fi

he doesn't see it in fact the solution offered is the figures could reignite expectations the bank of england may need to add additional stimulus to bolster growth now isn't this the same exact thing that actually has caused us problems yes it is it's more debt it's not cash it's debt because the bank of england has no cash all they do is they lower the reserve requirement for the entire system globally which means that they increase the debt load which means more repression which means more debt service which means more necessity to move billions from the pockets of those who thought they were getting any kind of return in their pension account into the pockets of the speculators exactly so when the pilot does not know and understand and trust his gauges he often causes a stall mid-air as that air france flight from brazil to paris that crash it was caused by pilot error when they stole the plane by doing the exact opposite of what they were supposed to do they pulled up sharp when they should have been to wherever they were going right and the people in the u.k. or the u.s. who are sufferin

how does that strike you in. >> i think the first thing to say about the bank of england and about theank of minutes is that these headwinds imply in the uk and, you know, in the western world in general that monetary policy has to remain very easy. the question of further easing, quantitative easing in the uk, qe3 in the u.s. and whether the ecb will actually go in that direction, i think all of that is path and kind of data dependent, right? how bad is that going to be? right now it doesn't look all that bad, but if those headwinds materialize, of course, we're going have another dose of monetary stimulus because as we were talking before the break, the fiscal side is going to be retrenching everywhere that counts, right? >> there's some concern in these minutes as well that inflation isn't going to come down quickly as the bank of england was wanting. is it wishful thinking that inflation is going to drop through the normal course of events? >> well, you know, i think in europe we have this issue that there's a lot of countries that are targeting headline inflation, and headline inf

of cooperation amongst central banks. but in the 1920s, germany was facing having to pay reparations. france and england and the u.s. were all bickering about war debts. and so the politics was quite bad internationally. and that impeded some of the cooperation of central banks. the other thing to say is that international central bank cooperation is probably even more important when you have fixed exchange rates. you had fixed exchange rates in the '20s because of the gold standard. that meant monetary policy in one country affected everybody. so that was certainly the case for more coordination, didn't it. at least today, we have flexible exchange rates which can adjust. and tend to insulate other countries from the effects of monetary policy in a given country. so that reduces somewhat the need for coordination. but there's still i think the need for coordination. well, thanks. this has been great and i'll be back on thursday. thank you. >> well, we're just about out of time at 2:00. i told my friends at the fed as we were setting this up, we thought we might have 10, 15 minutes for question and answer after the c

so the bank of england has to do all it can to keep interest rates low for a very long period of time. >> that's what banks are saying is since that went, the cost of funding has gone up regardless and why they're putting up mortgage rates. >> well, i mean, suddenly if the process were to continue, the bank might have to start contemplating additional measures, yes. but at the same time a lot will depend on the general financial environment where, of course, generally confidence has been improving. >> julian, stick around. christine, what's coming up? >>> plenty, ross. you and i know coming up next we have shares of deutsche post watching their shares closely. they see sales and operating profit edging up this year. details after the break. >>> welcome back. well, japan's increasing dependency on crude imports has swung its current account to a record $5.4 billion deficit this january. the world's third largest economy has been relying on overseas energy supplies because of nuclear power shut down following last year's quake and tsunami. japan has revised its fourth quarter upwards as

the bank of england was founded in 1694. and that of course, for many decades, if not centuries, was the most important and influential central bank in the world and france in 1800. so central bank theory and practices again, not a new, a new thing. we have been thinking about these issues, collectively as an economics profession and in other contexts for many, many years. now, i've exaggerated slightly in the sense that say the bank of england in 1694 wasn't set up from scratch as a full-fledged central bank. it was originally a private institution and over time it acquired some of the functions of a central bank such as issuing money or serving as lender of last resort but over time the, these central banks became essentially government agencies, government institutions as they all are today. certainly one important responsibility of central banks for much of the period that i'm talking about was to manage the gold standard. to issue paper money that was backed by gold. and i will talk more about gold in a few moments. now,

to the bank of england is doing a lot of this activity. they became very good at it. nd set the pace. it was the most important central bank. it helped established practices that we still used today. i need to talk a little bit about what a financial panic is. in general, and it has a loss of confidence in an institution. how many of you have seen "it's a wonderful life"? less people are watching christmas movies than they used to be. one of the problem they ran into it is they threatened a run on the institution. but i imagine a situation before there is any deposit insurance. no fdic. imagine you have a bank on the corner and this bank makes loans to businesses. if finances itself by taking the positives from the public and deposits hours. it means that anybody can pull up any time they want. people use deposits for ordinary activities like shopping. imagine what would happen if for some reason a rumor goes around that this bank has made some bad loans and is losing money. if i in the last person in line, and may end up with nothing. what are you going to do? you're

and that's why the bank of england is giving the inflation numbers a benefit of the doubt. it's cut the deficit, another 1% to 1 about.5% of the deficit each year for the next three or four years. so pretty tough times. i think a lot of what we'll see tomorrow is more political than influential for the bond market. >> mike, thanks for that. jackie. >>> let's take a look at the futures here and see how we're setting up for trade on wall street. looking like the dow would be lower by 60, nasdaq by 12 and s&p 500 a little more than 7. this after seeing modest gains yesterday. nasdaq and s&p hitting a new 52 week high, so that definitely is important to note. in terms of the dow, we saw a little bit of a boost this, but off the session highs when we did close, american express, exxon mobil dow components leading us higher. the s&p closed at 1410 on monday, up about 30% since the lows on october 4th, but our next guest says if history is any guide, we should beware of the levels. and joining us more is president of global trends investments and editor of the etft trends.com. and

crisis the european central bank has expanded its balance sheet by about three trillion euros the bank of england bank of japan they're all expanding their balance sheets and in so doing they are supporting the dollar they are creating a market where the dollar is never allowed to find its true price no matter how many people go to jail no matter what the unemployment rate is no matter how bad wages are are no matter how disgusting. as social inequality gets the dollar is a made currency is protected by the central bank mafia he can f. with the dollar or you could be accused of some crime and end up in that prison industrial complex tell me why that's not true but you know actually you're right of the dollar it was the beneficiary of the fact that everybody else is doing is doing the same thing but you know it doesn't matter to the american people in my view whether the dollar is up today against against the euro or some other free upward currency people don't look at the exchange rate or the dollar index when they go to work in the morning when the alarm clock goes off people work and save for w

ten-year guilt, nothing from the bank of england today from their rate decision. we'll have to wait two weeks for the minutes for that. certainly a very bullish turn in the market and oil in both euro and sterling terms in brent is now at an all-time high. back to you. >> ross, it's international women's day. is that okay with you. >> yep. >> okay. what about international -- >> good answer. >> what about international persons day? what about -- i said to becky, where is international men's day. >> i said that's every day. >> every day is international men's day. >> what was interesting the day has been used for a number of articles, the head of the confederation of british industry wrote an article saying how it was a time to keep that issue of women and boardroom representation -- >> that's good. >> today has been used to highlight that particular issue. >> okay. i'm good. i'm okay with that. that's still not completely the glass ceiling is still around, i think, and that hurts. you don't see it. >> ow. >> ross, thank you. appreciate it. you've never had to worr

i am today writing to the gov nefrt bank of england to reaffirm the cpi inflation target of 2%. the government's credible and responsible fiscal policy allows the independent central bank to pursue an activist monetary policy consistent with targeting low insflags. i confirm the asset purchase responsibility will remain in place for the coming year. so unememployment is growing, inflation is coming down, so too is the deficit. when this government came to office, the budget deficit stood at over 11%. the state was borrowing one in four of every single pound that it spent. today i can report that the deficit is falling and forecast to reach 7.6% next year. the share of national income will fall to 43% next year. we must stick to the course so there will be no giveaways today. because we've taken difficult decisions nor do we need to tighten further, over the five-year period, this is a fiscally neutral budget, and this is achieved through a modest reduction in taxation and spending. so mr. speaker, let me turn to those fiscal forecasts. the whole house will be pleased to know that

to liberate themselves from the gold standard from producing the world for themselves from the bank of englandand so forth. also there were some unusual people in the sense that we don't think of them as populists organized in america frances willard the head of wt sciu, also a big supporter of populism, she was a christian socialist in fact. so those are some of the leading figures of the time. >> what do you mean when you talk about radicalism? >> radical to me goes back to the latin word that is go to the root of the problem of society. so, radicals' believe in transforming society. the structure of society, not just making the forums here and there to basically just system. radicals believe in tearing up the system, mom violently in some cases but sometimes balance as well. >> who are some of the famous radicals in our history and today? >> not many famous today. the radical movement has shrunk. wall street i think is the beginning sprout of a new kind of radical movement, but they purposely don't have any readers. they are against having big readers. but in our history, people like dennis

your central bank-- in our case the bank of england-- will not be able to take the monetary activistapproach at the present times to take, and it will be entirely self-defeating. you might spend a bit more government money, which you have to go out and borrow, but you will actually undermine confidence in your economy. business and families will place higher interest rates. your bank of england, your central bank will not be able to run the loose monetary policy it's able to run. i think it will be entirely self-defeating. what's interesting is when you look at people looking at the british economy like the i.m.f., like the o.e.c.d., other ands, they actually have applauded our program. they have support outside program. and if you look at the confidence the markets have had in the u.k., that has been pretty unwavering. >> rose: market one thing. how about economic growth as another? when they look tat also they say it has not achieved some of the objective they hoped it it would have achieved by now. >> we have been hit, like every other economy, including the u.s. economy, by the s

of those feudalism and let me explain something or the bank of england hundreds of billions of pounds into the economy if it were capitalism that money would go into both house of price appreciation and wages. that's called inflation but because of the financial engineering this taken place because of the re architecting the global economy in favor of the top one percent of the top one percent that money pump like goes irrigation sluice project it goes into asset prices like oil this is why the price of petrol is at the highest it's ever been in the u.k. never been higher because of the money pump but wages are flat in fact going down in fact they want people that work for nothing so if there were capitalism it would be competition this is not capitalism this is feudalism this is the return of the dark ages and these people who are saying oh they're anti-capitalist are completely wrong it's not capitalism little it's corporatism you know they the way corporatism snuck in is they use the we're the government and we're here to help you that was the scariest words in the english language

trillion euros the federal reserve bank will expand its balance sheet to thirty trillion dollars bank of england will spread this trillion trillion pounds bank of japan same thing it doesn't matter the money is becoming just tokens in a global game called reality bill that has no accountability whatsoever but it's just basically this lava lamp economy that people pitch a ride on to and ride for all it's worth and if you don't get in the right place at the right time you're out there living on the edge of the person in the woods in the tent where there is one positive spin on how you can possibly make some income in this final headline what isn't for sale so you know all these students struggling with their student debts according to this article market thinking so permeates our lives that we barely notice it anymore a leading philosopher sums up the hidden costs of a price tag society basically you can buy anything shocking things but you can also sell anything you can sell space on your forehead to display commercial advertising and make ten thousand dollars a single mother in utah who needed m

the bank of england which is twenty one percent and the bank of japan's which is thirty percent but moving on from that i want to look at the greek deal because in a report from the think open europe in europe they said that at the start of this year thirty six percent of greece's debt was held by taxpayer backed institution it's by two thousand and fifteen after this deal has gone through that sure could increase to as much as eighty five per cent so let's go through the scenarios does this mean that this is going to amount to a lot more political and economic strife in the euro zone as we see taxpayers responsible for all of this debt and greece could have a situation that interior is even further. good grief when you. take most. of this was on the idea to move on a little bit with the lucian that bennett maybe never lost but there would be a. one way. or silly real need are we seeing some kind of imperial europe reemerge where the core is essentially taking control of the periphery but this time not with armies they're doing it by sending in the trike and settling on with debt buying th

bank that is just under a thousand percent of g.d.p. there has already ben this magnificent crash in the u.k. economy that camera on. he and ahs bore and mervyn king over there to bank of england through price manipulation. i are are hiding the crash essentially but now the people on the street are beginning to feel because for example gas is out of all time high priced in british pounds that's the result of oz born sneaking in this one hundred year guilt and other quantitative easing techniques and try to hide the fact that they're standing in front of the curtain that's hiding like the wizard of oz this multi-tiered the british virgin has over five trillion pounds in debt that's there they're not even officially keeping on their books well ok let's talk about this hundred year guilt however who sold it to them if you're sitting at a table discussing a derivative or a product or a bond with goldman sachs you can bet your of them not but so look at the prospectus speak and the way the treasury sold this to the media who doesn't ask the questions a treasury source said tonight this is about locking in for the future the tangible benefits of the safe haven status we have today t