and the intervention by the fed the activist fed who came in the greenspan put that you would never ever lose money if you just continued to believe in the s. and p. 500 because the fed would have your back well you see the divergence really take off that you know nominal g.d.p. has just been the same slowly rising just like gold over the past few decades since alan greenspan but the s. and p. 500 has taken off doesn't care about earnings or anything like that you know because the g.d.p. is based on consumption and tied to wages and earnings and economic activity and manufacturing and things like that are tangible the s. and p. is based entirely on the ability to as zeros to your earnings statements based on the money that's being given to you by your king god the federal reserve bank and so there is no connection and there is no need as i've said before the 3 trillion dollars or so that are collected every year by america's internal revenue service to fund the budget is is not needed whatsoever they can simply print all the money they need it's a token amount compared to the amount

is to spend the same like slowly rising just leg old over the past few decades since alan greenspan but the s. and p. 500 is taken off doesn't care about earnings or anything like that i know because the g.d.p. is based on consumption and tied to wages am earnings an economic activity and manufacturing and things like better tangible the s. and p. is based entirely on the ability to as zeros to your earnings statements based on the money that's being given to you by your king god to federal reserve bank and and so there is don't come action and there is no need as i've said before that the 3 trillion dollars or so that are collected every year by america's internal revenue service to fund the budget is is not needed whatsoever they can simply print all the money they need it's a token amount compared to the amount of they print 16 trillion and they collect 3 trillion in taxes it's a now it's not it's a rounding error is nobody needs that money well these 2 are required just like the taxes make it feel real so if you didn't have to pay taxes like it's all of monopoly game but it feels re

greenspan insists that benefits reform is essential. ♪ >> we are already turning a corner.we now start to make major changes our productivity growth rate will slow down. below where it is now which is 1% a year. we are trying to spend more than we have. we made the decision that we will spend only what they have. it took 500% interest rate. >> i want to talk about the underlying series at the moment. you don't talk about monetary policy per se. you have been good about that. i must ask a fiscal question. we have a heritage of a generation that have told us that someday there will be trillion dollar deficits. they are upon us right now. what is the greenspan prescription to help our grandchildren and your great-grandchildren with this conundrum? >> first is to address the source of the problem. the source of the problem is that we have a defined-benefit program for social security. for pretty much everything else. what we need to do is go to a a defined contribution program. the 401k is all we have. that will put a damper on our major problem. if we can resolve that, we have

alan greenspan. i spoke to chairman greenspan last night. really looking forward to this. , as he considers the effect on america's productivity and economic might. later today. this is bloomberg. ♪ ,"m: "bloomberg surveillance in london, in washington. we will see what david westin brings in the coming weeks it a smart conversation to wrap up week. right now, a smart conversation with francine at our london desk, his john normand of jp morgan. the correlation he brings into the asset classes of equities, fixed income, currencies, and commodities. what is the headline of note this weekend, john? what has changed with all that is going on with international relations? how does that correlate into the correlations? john: to me the headline is that there are a lot of developments in play, none of them really that major, meaning that even though the oil price surprised, it is not that much of a surprise or shock in the context of an oil market wher production is diversified. some of the data has been consistent, most of them moving in the right direction. and a lot of headline

. >> alan greenspan says the only way to curb deficits is to pull back benefits. >> we are trying topend more than we have. >> that's all ahead on bloomberg best. ♪ hello and welcome. i'm sebastian star lick, and this is bloomberg best, your weekly review of the most important business news, analysis, and interviews. let's start with a day by day look at the top headlines. we began with markets reeling from a geopolitical shock in iraq, an attack that killed one of iran's top military officials. ♪ >> the fallout of a top iranian military commander is widening. lawmakers in iraq have voted to expel american troops. iran says it will no longer abide by the nuclear deal reached with major powers in 2015. >> president trump also threatening iran with major retaliations if they "do anything." where are we right now? >> we are hearing reprisal talk on both sides. we are hearing from iraq, the parliament voted that they do not want u.s. troops in iraq. -- this is the death the death, of course, for the nuclear accord. what happens in terms of any retaliation from iran? >> oil hit $70 a barr

sat down's tom keene's in washington for an exclusive authorization with alan greenspan.nomic issues including the u.s. welfare and so security system. he insists that benefits reform is essential. ♪ turning aalready corner. we now start to make major changes. our productivity growth rate will slow down. is 1% a year. more thaning to spend we have. that wethe decision will spend only what they have. it took 500% interest rate. >> i want to talk about the underlying series at the moment. you don't talk about monetary policy per se. i must ask a fiscal question. we have a heritage of a that have told us that someday there will be trillion dollar deficits. they are upon us right now. what is the greenspan prescription to help our grandchildren and your great children -- great-grandchildren with this conundrum? >> first is to address the source of the problem. is source of the problem that we have a defined-benefit program for social security. for pretty much everything else. what we need to do is go to a could -- a defined contribution program. the 401k is all we have. on ou

greenspan had in $1096.00 and warned of irrational exuberance and then went on to catapult higher yeah the i.p.o.'s that were being launched at a 50 to 60 percent 1st day pop this year remember that was the big thing i remember when i was at the hollywood stock exchange we were about to go public a barrister and barbara streisand was calling me asking to get stock in the i.p.o. . well things are crazy as it's a lot of 19000000 i met i think it's similar to 1999 only 999 or 1929 max i think the valuations are in the stratosphere valuations. on the metric that you know university uses. of holiday never get iroh close to all time historic highs only have we didn't have in 1990 are so many $1000000000.00 zombie or ration and we've actually got a couple of trillion dollar unicorn's of dollars that already come out of the closet i mean we've got like amazon companies like. google and apple with the valuations that are a little bit ridiculous right now but they keep or not with them not me it is free for the sad fact that. the european central bank. has been buying it in the bank and is buyin

greenspan had in 1906 and warned of irrational exuberance and then went on to catapult higher yeah the i.p.o.'s that were being launched at a 50 to 60 percent 1st day pop if you remember that was the big thing i remember when i was at the hollywood stock i say we were about to go public a barrister and barbara streisand was calling me asking to get stock in the i.p.o. you know things are crazy is it similar to 99 which i mean it's similar to 1999 only 199-1029 max i think the valuations are in the stratosphere. on the metric that you know university uses. that i are of all time historic highs only have didn't have in 1998 1000000000 dollar. or. and. upward dollar unicorns the. dollar. amount of the files that. amazon. and apple were the valuations that are a little bit ridiculous right now but they keep or not with them not. for the sad fact that. the european central bank. has been buying. and is buying them hand over fist the swiss national bank is hand over for me it's just a matter of time before the fed starts buying equity for the i think that it will see more clearly i think we

that we could see a doubling like we did in the end of the parabolic move because member alan greenspan had warned that the markets were displaying irrational exuberance he said that in 97 we continue on for 2 more years 1909 as a going to be 85 percent we only went up 40 percent and $21000.00 if this is exuberance and you know the retail investor wasn't really participating in 29 everybody hated it everybody was like dissing even big names like carl icahn everybody was out so this could be the year that it's in and that ties to this final headline nobel laureate economist praises truong for stock market rally he creates animal spirits nobel laureate for economics robert shiller sees president donald trump as the primary cause of wall street's recent strength because he stoking the markets animal spirits schiller a woman nobel prize in 2013 chillers newly found praise for trump is a huge turnaround from the point of view he held back in january of 2018 when he said in an interview he would give trump a grade of one or 2 out of 10 when it comes to economic policy he said he didn't vote f

dr and that's the jimmy geitner doctor and that's the ben bernanke you doctor and that's the alan greenspan doctor that's a jay powell doctrine is forget all rule of law for people with a lot of cash from the fed. in terms of fighting the fed and this war with the fed and this war with economics and business cycles for example. we're in this sort of benign totalitarianism is where they don't have to lock up short sellers for example remember during the financial crisis it always emerged that emerged in europe and the u.k. and the united states were going to ban short selling because the short sellers i.e. those taking a bet against the markets are the ones causing this well they don't even have to do that anymore they don't have to threaten to arrest anybody or ban anything or throw people in prison they do it themselves because they've been trained through years of abuse and that is nobody is short short sales and the s.p.d. are s. and p. 500 e.t.f. trust known by its ticker s.p.y. as a percentage of shares outstanding fell to 1 point one percent last tuesday that's the lowest level since

chairman greenspan said he remained concerned about the u.s.eficit and offer this piece of advice is one way to trim the numbers. >> we have a defined benefit program for social security and pre-much everything else. is go to ad to do confined contribution program. the 401k is all we have. on major put a damper problems. david: you can hear more of the interview airing throughout the day on bloomberg television and radio. coming up friday, i will be hosting a new plug graham for bloomberg television -- a new program for bloomberg television and radio. bring you the most important stories of the week, stories that affect wall street in the world, with regular panel of leaders. this week will be larry summers and roger ferguson talking about the events of the week. our panel will be joined by the former under secretary of defense for policy to discuss one of the top stories of the week. that is yes relating tensions with iran. that is this friday at 6:00 eastern time on bloomberg television and radio. ons is "balance of power" bloomberg televisio

. ♪ alan greenspan, a great mentor, i remember they retreat significant lives in interest rates.otten too cute in our monetary policy? have we become too measured and too careful in the use of the monetary tool? >> remember monetary policy is a forecas at the root.

alan greenspan and when he testified to congress he explained his success in running the economy as based on what he called greater worker insecurity. a typical restraint. compensation increases has been evident for a few years but as i outlined to some detailed in testimony last month i believe that job insecurity has played the dominant role workers in security are going to be under control. they're not going to ask for say decent wages were a decent working conditions or the opportunity to free association meaning unionized. now for the masters of mankind that's fine they may show their profits but for the population it's devastating. for these 2 processes financial ization i'm sure are part of what led to the vicious cycle of concentration of wealth concentration of power. so wrong. we're all just all. well yet to stamp out this thing to come at some point and engagement equals betrayal. when someone find themselves while the party. system the for common ground. i actually don't think monopolies per se are the problem it's monopolistic access to credit or to politicians and probably b

alan greenspan when he testified to congress he explained his success in running the economy as based on what he called greater worker insecurity. a typical restraint on compensation increases has been evident for a few years but as i outlined in some detail in testimony last month i believe that job insecurity has played the dominant role workers in security are going to be under control. they are not going to ask for say decent wages were a decent working conditions or the opportunity to freeze or. meaning unions. no for the masters of mankind that's fine they may show their profits but for the population it's devastating. to these 2 processes financial ization sure are part of what led to the vicious cycle of concentration of wealth concentration of power. by 2020 presidential campaign is beginning to look a lot like the 2016 race but this time around the insurgent is bernie sanders who is not even a member of the democratic party voters again are not interested in establishment politicians in fact they appear to be rebelling against the movie scene from sandhurst showdown. i actua

like calling alan greenspan a political hack. alan greenspan may be many things but political pack he certainly isn't. and george w bush calling him at others are saying the iraq war is lost. by the middle of a major military exercise there. i can't fail to express my objection to that kind of rhetoric which is frequently flat-out wrong. lamar alexander: plus take one of the person. you talk with the senate conservative funds and you write about senator reid and you have a chapter titled professor obama. why did you choose those words. mitch mcconnell: the president is a very smart guy. i think he knows a lot about a lot of things. i think he would do a better job of dealing with others if he was or spend less time trying to appoint whoever he is talking to in the moment his brilliance and more time listening. just drop in contrast. i've been in a number of major fuel to the vice president. he doesn't spend any time trying to convince me of things he knows i don't believe. i don't spend any time trying to convince him of things.

. >> the term irrational exuberance, obviously, was made famous by alan greenspan. >> yeah. >> are you feeling any of that today as you look at the market, and do you think jay powell may be >> when alan retired i had a ranch and gave him petting rights to the bull the bull's name we changed to irrational exuberance. he sent me a letter with a picture of him and the bull and said richard, irrational exuberance is really a lot of bull i believe we are richly priced right here i'm not a market expert or timeer if you look at it, unless we get the kind of earnings growth, which we hope we get, one could argue it's certainly fully priced if not richly priced. >> we all remember the market after those words of alan greenspan, went up another four years. it got even more irrationally exuberant. i have the gang in front of me, as you know. i would like to get their thoughts on what you said less on the trade side but more on the market side, that the market is too rich. what do you think? >> it's exuberant. it may not be irrabble exuberance but it's exuberant. >> you're right to cite the fede

forces of financialization that are checked by wages etc but that's dead that's dead since alan greenspan destroyed the federal reserve mandate and targeting only the stock market and donald trump also his only metric for success is the stock market and that's all driven by money printing and it all goes to bury few people in the private equity and hedge fund business doesn't trickle down anywhere because there's no connection it's 2 completely separate worlds down america it's bifurcated well speaking of bifurcation i do want to know and i don't have this headline right here but over the christmas holidays the new year there was a story that will probably get overlooked but that is that several banks including j.p. morgan. h.s.b.c. allegedly were listening in on bank of england press conferences via an audio stream sold to them by a 3rd party service. the rest of the world was looking at the video story they had special access the audio stream and if you know anything about streaming it obviously takes more time and energy to compress the video so there was a 6 to 8 2nd delay where all t

soar quickly when they realize oh wait what am i doing i'm thinking like the olden days before alan greenspan before there was the fed fighting the investor speculator class so now they whatever every time there's bad news is always when markets soar them.

not a free market for criminals not a free market for fraud not the kind of free market that alan greenspan believed then until suddenly he woke up much to his surprise and said good heavens there's datable and going on here that's amazing it had that foxhole conversion saying the mess is created but isn't aside from the outright criminality and fraud there it is essentially neo liberalism has worked for large part of the population i would say the boomers it essentially we've had a pyramid scheme and it's mostly based on property but they were 1st then so isn't it naturally going and even if it's not outright fraud by the new population of younger people who are like dudes like i have to like i can't live like ray and like i can afford education health anything property nothing well what you describe is happening to the young people in america is what's happened to young people in greece they emigrate but americans don't have anywhere to emigrate to because they don't speak foreign languages that don't speak but they're not allowed to because you can't because of the new laws whereby banks

soar quickly when they realize oh wait what am i doing i'm thinking like the olden days before alan greenspan before there was the fed fighting the investor speculator class so now they whatever every time there's bad news is always in the markets or the most right well don't forget eric holder tim geithner member in 2008 they came out with the holder doctrine so about moral hazard they institutionalized moral hazard they said every time you banks commit fraud every time jamie diamond commit fraud we are going to cut those laws out of the books we're going to eliminate laws against financial fraud whenever you commit fraud oh by the way of jamie diamond by citibank or travelers corp of violates class struggle oh well we'll just get rid of glass steagall to accommodate jamie dimon because the eric holder doctor knows that jimmy geithner doctor and that's the ben bernanke you doctor and that's the doctor that's a jay powell doctrine is forget all rule of law for people with a lot of cash from the food. in terms of fighting the fed and this war with the fed and this war with economics and busine

not a free market for criminals not a free market for fraud not the kind of free market that alan greenspan believed in until suddenly he woke up much to a surprise and said good heavens there's datable and going on here that's amazing it had that foxhole conversion saying the mess he's created isn't aside from the outright criminality and fraud there it is essentially neo liberalism has worked for large part of the population i would say the boomers it essentially we've had a pyramid scheme and it's mostly based on property but they were 1st then so isn't it naturally going and even if it's not outright fraud by the new population of younger people who are like dudes like i have to like i can't live like right like i can't afford education health anything property nothing what you describe is happening to the young people in america is what's happened to young people in greece they emigrate but americans don't have anywhere to emigrate to because they don't speak foreign languages that don't speak but they're not allowed to because you can't because of the new laws 3 whereby banks overseas

not a free market for criminals not a free market for fraud not the kind of free market that alan greenspan believed in until suddenly he woke up much to his surprise and said good heavens there's datable and going on here that's amazing it had that foxhole conversion saying the mess is created but it isn't aside from the outright criminality and fraud there it is essentially neo liberalism has worked for large part of the population i would say the boomers it essentially we've had a pyramid scheme and it's mostly based on property but they were 1st then so isn't it naturally going and even if it's not outright fraud by the new population of younger people who are like dudes like i have to like i can't live like ray and like i can't afford education health anything property nothing what you describe is happening to the young people in america is what's happened and the young people in greece they emigrate but americans don't have anywhere to emigrate to because they don't speak foreign languages that don't speak but they're not allowed to because you can't because of the new laws whereby ba

not a free market for criminals not a free market for fraud not the kind of free market that alan greenspan believed in until suddenly he woke up much to a surprise and said good heavens there's datable and going on here that's amazing it had that foxhole conversion saying the mess is created but isn't aside from the outright criminality and fraud there it is essentially neo liberalism has worked for large part of the population i would say the boomers it essentially we've had a pyramid scheme and it's mostly based on property but they were 1st then so isn't it naturally going and even if it's not outright fraud by the new population of younger people who are like dudes like i have to like i can't live like ray and like i can afford education health anything nothing what you describe is happening to the young people in america is what's happened to young people in greece they emigrate but americans don't have anywhere to emigrate to because they don't speak foreign languages that don't fit but they're not allowed to because you can't because of the new laws whereby banks overseas won't open

alan greenspan gave an interview in march 2019 saying rising budget deficits lead to -- he reiteratedt warning last month saying it is inevitable, going to rise. u.s. congressional office is expected to see the debt at one point true trillion dollars. -- david: thank you so much. our -- he is the investment director. our interview with the bank of bangkok president. we will take that live and talk about the takeover of indonesia's bank. also coming up and sticking with the panel, the bank of thailand governor sat down with us. he is not happy about the strong currents. this is bloomberg. ♪ back to theme program. we are going to get you guys updated on what happened almost literally this time yesterday, the boeing crash in iran. according to people familiar with what is going on, the u.s. investigators are weighing the legal and safety issues of this request. it is essentially iran is, iran may seek u.s. help in this through e.u. entreaty. they may seek u.s. health and u.s. investigators for their part are weighing the legal and safety issues of the request. to put that in simple engli

ambition has always been determining the outcome of the 20/20 election which is why you had alan greenspanow we can beat him is what he said, this is about reelecting the president, alexandria ocasio cortez saying we have to avoid a disastrous outcome in 2020, donald trump will be elected in greater numbers than before, they know it, that is what this is about. >> look at the facts. >> there. to be no chance the 20 republicans would vote to vote the president out of office and how much of this is about chuck schumer trying to put some of your colleagues on the line here and become majority leader in the new congress? >> is trying to put tough votes in front of senators who have tough races across the country. it is important that we see a strong acquittal of the president we will. we will pick up a few democrats and send a strong message about the sham of a process, important constitutional moment. even rises above the current fight we haven't that is you cannot allow the house, the tyranny of the house to throw a half-baked impeachment to the senate. it was never intended that way, the fo

the level of rates today is so low relative to the level of rates back in 1999, where greenspan was hikingg into the internet pocket. the real rate, the overnight real rate is close to zero. the overnight real rate back in 200 to00 was close to 300 basis points in real terms. when you have an overnight real rate of 300 basis points, that tells you intuitively, the price of money is very, very expensive. when the price of money is expensive, credit doesn't get created, investments don't happen, and that is when the economy really slows and you get into that recessionary environment. today, we are far from that. so, i like to tell people, attention to the level of rates, and then, to get additional detail as to what is going on in the economy. then look at the slope of that term structure. vonnie: does this breakout gets sustained? talking about the breakout to yields on the lower side. do be round backup to our most recent range? ash: i think you ramp back up. i think this is your typical risk-off, flight to safety. you see the yen versus the u.s. dollar rallying. you see global treasuries

so i do object to the way that he ran the senate and i do object to this rhetoric by calling alan greenspan a political hack and it may be many things but a political act certainly isn't. calling george w. bush a loser or saying the iraq war is lost right in the middle of a major military exercise, so i can't fail to express my objection to that kind of rhetoric which is flat-out wrong. >> host: let's take one other person you talk about the funds and write about senator reid. you have a chapter entitled professor obama. >> guest: the president is a smart guy and i think that he knowsws a lot of things. he would do a better job dealing with others with whoever he's talking to at the moment with his brilliance and more time listening. a strong contrast between the president and vice president. i've been at a number of major deals with the vice president. he doesn't spend any time trying to convince me and thinks he knows i don't believe and i don't spend any time trying to convince him of things he doesn't believe. in other words, you don't waste time on both a. we try to figure out what we

different i don't object the way he ran the senate but i do object to the rhetoric like calling alan greenspan a political hack he may be many things but a political hack he certainlyly isn't or george w. bush a loser or the iraq war is lost in the middle of a major military exercise. i cannot fail to express my objection to that kind of rhetoric which is frequently flat out wrong. >> let's take one other person the senate conservativeve fund you write about senator reid and you have a chapter entitled professor obama why did you choose that? >> the president is a very smart guy. he knows a lot about a lot of things. i think he would do a better job of dealing with others if he spent less time to acquaint whoever he is talking to at moment with his brilliance and more time listening. there is a strong contrast with the president of i.c.e. land i have been in some major deals with the vice president and they were worth doing for the country. he doesn't spend any time of convincingly of things that he knows and i don't spend time convincing him things he doesn't. we don't waste time on that we g

tom: alan greenspan wanted to make those choices at age 93, yesterday, when i spoke to him. this for years. why is the deficit a nonevent in your world? andstopher: i don't know, it is interesting that central bankers like the federal reserve are arguing, do not look to us to rescue a nation from the next recession, look to fiscal policy. tom: you argue we have fiscal spending, another year of a 17 year conflict? christopher: i am not the boss, but can't -- congress thinks they have fiscal space. we have a 200 $20 trillion federal debt. it is a mystery that these bonds and options get snapped up. the big worry, the fiscal debt bomb coming with the baby boom to 75,ion, basically 55 the crunch time to pay for their social security will come over the next 10, 15, 20 years when they age. we are not there now. tom: mr. rupp key saying the baby boom age and in at 75. -- ending at 75. robert hormats, we will extend that out to keep you a baby boomer. we will continue, much more coming up. anna: coming up, we will get back to the story surrounding a boeing 737 jet that crashed in ir