society no paul volcker obviously completely lost your marbles. will read your book though he also warns in his memoir that there is no force on earth that can stand up effectively year after year against the thousands of individuals and hundreds of millions of dollars in the washington swamp aimed at influencing the legislative and electoral process but we've covered this over the years i've been studies a various universities looking at the impact of lobbying and millions of dollars and now the supreme court like he says oh the population doesn't have any respect for the supreme court or the recent supreme court allowed for citizens united and unlimited campaign donations so that of course. means these billionaires like jeff bezos who is worth one hundred twenty five billion dollars has way way way way way way more influence than entire populations of states across america so of course he's going to be able to buy legislation legislators and of course he's going to be able to maintain. in his monopoly and he does have a monopoly over fifty perce

let's turn to the first headline here i do actually have a headline and it's from former fed chief volcker warns of u.s. descent into plutocracy former federal reserve chairman paul volcker said in an interview published tuesday that the united states is developing into a. tucker sea and suffering from a crisis in good governance both were ninety one told the new york times that he feared that the skill and reputation of the us government has been corroded by self interested elites cheeping long through lobbying and campaign donations he said the country was quote and a hell of a mass in every direction rip van winkle paul volcker as if he'd just woke up after decades of the drift toward plutocracy a wherever you began paul walker interest rates went negative the economy has gone plutocratic gone on for quite some time paul volcker is right it's just you know a little bit too late too little too late you know he's a former federal reserve chairman who actually understood what the role of the central bank was to raise interest rates if there's too much speculation under grace penney ruto on

volcker rule. that is in the law, so it is there. something the banks have had a hard time with and regulators have had a hard time setting up. i think there is sentiment in the federal reserve to simple high the volcker rule. -- simple five the volcker rule. could you give me a comment on that? i do not think we want to go back to the days when you had huge, risky trading floors with inadequate capital. we know where that went. but are there proposals, or how do you see the volcker rule playing out? do you think it is damaging, as has been claimed, issuance by smaller companies and smaller bond issues because of the ence of the volcker rule making it difficult to make markets? >> i do think there have been effect on markets from the volcker rule. they are difficult to quantify's precisely, but i think there is universal sentiment among market participants that the volcker rule has affected liquidity in some markets and i think that is probably true. reasonable people can differ about the extent of

. >> let me ask you a comment on volcker rule. so that's something that's been -- it's in the law so, you know, it's there. it's something that the banks had a hard time with, it's something that regulators had a hard time sorting setting up. i think there is sentiment to, in the federal reserve to simplify the volcker rule. so, could you give me a comment on that? i don't think we want to go back to the days when you had huge risky trading floors with inadequate capital and we know where that went. but are there proposals or how do you see the volcker rule playing out and do you think it's actually damaging, for example, as has been claimed, issuance by smaller companies, smaller bond issues because of the presence of the volcker rule making it more difficult for institutions to make markets? >> to take the last part first, i think there have been effects on the market by the volcker rule. i think that universally, the market participants that the volcker rule affected liquidity in some markets and i think it's probably true. rea

is not a fair statement yes what happened at the peak of the chart you just held up was paul volcker so you hit it right on the head that was the and basically what had been a forty year increase in interest rates and inflation and we don't need to go into the details of it but that pinpointed the top and interest rates and inflation have been dropping ever since so the federal reserve in order to keep the party going dropped rates down to zero and kept them there too long under greenspan from two thousand and three the way to two thousand and six until we created a bubble in the housing market and the mortgage market and what you are really seen the fed do is they are attempting to keep growth going. through bubbles acid bubbles and they took the form of mortgages and real estate now they're taking the form of stocks who knows what's next i don't believe there is a next i think we're at a terminal point and which that game continues to worsen the bubble of bubbles it has popped and that's a call that we have had many folks on the show make that bond market rallies over the past five

the volcker rule is still very convoluted.toric levels of volatility and liquidity that should we us ill, have times of market stress. unfortunately, i think the fed could have done a whole lot more with their other prudential regulators in trying to simplify the volcker rule. that is number one. number two, i still don't understand why we have a qualitative aspect and not just a quantitative aspect to scar, a thatthe stress tests leaves too much discretionary power in the hands of regulators. i want to understand why that is there. ofy dropped it for one tier banks but kept it in for three. a good first step, but if it is the only first step, it is not getting is where we need to go to ultimately help sustain three, perhaps 4% economy. thed: how much is up to discretion of the federal reserve and other regulators consistent with statutes, and how much needs to be changed statutorily? well -- again, we went through this exercise and a house went through a far more robust bill in the financial choice act, then the senate was ab

. >> use it in the beginning that you refer to paul volcker.but from the united nations which thanks to paul volcker has a certain mechanism in place that were not at the time of the food program. you are aware of what he left. what kind of mechanisms for oversight and etc. you have to deal with when you talked about whistleblowing. that is a really good question. i would say this when i arrived, they were just beginning to supposedly beginning to revamp those mechanisms and say we have an officer and an ombudsman. so, from a technical standpoint and as a lawyer i can tell you i informed my supervisors this is happening. we need to discuss. it's before i was able to create the records from before the fed. we filed the whistleblower lawsuit and how with respect to that mechanism one of the decisions the team made it clear going to call the fed and say we have all of these evidence do you want it back and they didn't want it back. they didn't want to do anything about it. they could have taken it back. >> you referred briefly to what you call a p

. >> thank you very much i know when you referred to paul volcker that i retired from his specialized agency of the united nations which thanks to paul volcker now has certain oversight mechanisms in place but didn't at the time. so i would be very interested to follow up on the question that was just asked if you would say something about what mechanisms for oversight you had to deal with? you talked about before but what is in place already quick. >> that's a really good question. i would say when i arrived at the fed they were just supposedly beginning to revamp those mechanisms we have these offices but in practice if you are fired before you contribute to those mechanisms so from a technical standpoint i did trigger it i informed my supervisors this is happening and then i was fired so i started that but could not trigger it completely because i couldn't get anyone on the phone with me before i could create that record but everything in the book is exactly what happened and how you manage with respect to that mechanism. it back and thet want it back. they didn't want to do anythi

you said in the beginning you referred to paul volcker but now thanks to paul volcker there are certainoversight mechanisms that were not at the time of the food program you are aware of the inquiry. so i would be interested to follow up on the questio a quess just asked if you could say something about what kind of mechanisms for oversight and ethics you had to deal with when you brought you talked about whistleblowing but that is a very broad general statement. what is in place already that doesn't work? >> that is a good question. i would say this. when i arrived they were just beginning to revamp those mechanisms saying we have an ethics officer and you get fired before you contribute to those mechanisms. so, from a technical standpoint i did trigger it and i informed my supervisor this is happening and we need to discuss. then i was fired. i was able to create the record and another one of the things i talk about is a little bit in the bucket i book it is exactlyt happens when you are trying to tie all that how you manage with respect to that mechanism. we are going to call the fed

i go back to paul volcker. he is essentially a commodities index to indicate whether inflation -- commodities are what we should look at. maybe the rest of you can dispute this. if you look at commodity prices they are falling, not rising. someone tell me how that's an indicator of inflation. i don't see it. >> you've got wages a little bit. i would argue, we all deserve a little here. america doesn't have any for 30 years. >> i definitely agree. you look at the three pillars of the economy. i was think it's housing crisis, which are still in jena. wages which are growing and the unemployment rate. you have those three things. the economy is in good shape. it sounds like you're coming from my perspective. they can plug all these numbers into an algorithm and have one guy in there pushing a button on their ibm computer that would take care of the fed funds. >> i'm an hundred% agreement. any time the commodity prices rise, then you need -- >> by the way, what's wrong with one economy? >> i'm not a gold guy. why n

david: another aspect discussed was the volcker rule.e had the outgoing chair saying we have to change the volcker rule. are they moving forward to simplify it? if not, water down? >> i don't think it will be watered down. the banks assumed a hard brexit, hard exit. rule,se with the volcker they have gotten out of the proprietary trading that was the issue. you can't water it down. you are either in proprietary trading or not, and nothing proposed would provide a path for reentry into proprietary trading. about i talked yesterday the regulation of the nonbanks. there is private credit stepping in. you have large asset managers doing things that banks used to do. said wey, one guest have been watching it and it does not look like that big of a problem. is that your sense that we are of regulatingnk the nonbank lenders? >> not at this point. they have individually and collectively a small share of the market. there doesn't seem to be a need to stifle innovation. alix: if you were advising a big bank, would you say it is time to take on mor

ups and downs in goals the long term movements you know we had a crisis in one nine hundred eighty volcker came in and raised interest rates faith and the fed was was restored golf all the way from eight hundred to brown's bottom in two thousand when the bank of england decided to diversify out of gold right at the bottom of you know two water two hundred fifty two hundred fifty dollars an ounce i believe the then we had the dot com crisis and people started thinking well you know what does central banks don't ever they're going to control gold rose all the way to nine hundred box they burn akki came out with the statement right about that time if this was when the fears that the eurozone was going to break apart he said believe me he said we will do enough to save the euro and believe me it will be enough that curiously he didn't do anything max didn't do a thing all he did was make that statement q.e. did not come for two more years after he made that statement but it was enough to put face back in the euro face back into central banks. when when gold bottomed around to two thousand and

the situation was not as easy as mr volcker tries to describe it or is a party leader saying because the whole party of the holy the ship unanimously say yes we don't draw on a government with america then the leader in system is already criticised to keeping that line i kept aligned with a unanimous vote and then all the other people of the leadership of my party changed the strategy joined the government and asked me not to do the same thing so you blame the party you're going to among them going yourself for breaking a promise i blame myself the miscalculation he spoke about was that i missed the stroke and this is my mistake. that normally it is think about that the party changed with good arguments a strategy and is asking the leader of the party not to follow the strategy. ok that was the case and therefore are resigned mr wilder as i think a man who is always commenting but from a point of view a very far from the practical experience is political as have to make i understand during the campaign you often seem to have conflicting roadmaps you were plagued with doubts you didn'

wanted to get a further briefing and we have to hear from the president how do you explain that mr volcker mean the this event happened on sunday it's now wednesday in the u.s. president it's still his making up his mind well i wouldn't say making up his mind there as you pointed out there have been some conflicting reports we need to have a clear assessment as to what we think actually did happen and what the significance of that is and what our options are going forward so i think it's fair to give the president chance to assess that himself and he'll make his own decision as to how he wants to proceed do you see it as a showing strength if the u.s. president meets with the russian president because i think about how it was in two thousand and fourteen and us president obama he did he did not meet with mr putin right i think the way president has always talked about this is borrowing a phrase from president reagan peace through strength it's important to build a strong position and we've done that through sanctions through helping ukraine strengthen its defense capabilities through clari

the political will is in existence but we must fight to obtain justice for all the victims of the volcker times crimes against humanity by the highly responsible political and military responsible for the commission of these crimes but. of course is the idea of situation nice away from from now only now i must see carla del ponte oh thanks for joining me on that front. ok. gaza is imploding and we remain on the brink of another potentially devastating conflict the words of the un special envoy to the middle east this past week has seen even more violent and escalations with rockets fired from gaza into israel and an israeli airstrike killing three palestinian children in gaza since the great not to return protests began earlier this year israeli security forces have killed more than two hundred people in gaza and wounded more than eighteen thousand so is another full scale israeli attack on the strip inevitable joining me to discuss this a double mcintire former jerusalem correspondent for the independent and author of the book gaza preparing for dawn i'm not a palestinian humanitarian ai

for ukrainian conflict mr volcker to play a representative role of someone who's trying to seek consensus between two conflicting site here and on the other side and lugansk. ukraine on its part remains adamant that it is innocent blameless they call in russia to see immediately released the three vessels and the crews and say that this was an act of war act of aggression carried out by russia. well apart from the recent escalation between russia and ukraine vladimir putin also touched on other major topics at this year's russia calling investment forum in moscow among them the role the us dollar planes in the global economy and you're a cheater breaks down. a lot of time was dedicated to talking about the state of traditional global trade in association with the us dollar and was clear about how now is the time for innovation and change action and consequence top of the mantra of america first is now embedded in our minds and economically there was always bound to be a backlash as president of the united states i will always put america first we put on tariffs or two hundred fifty billio

hundred two it couldn't get above one thousand but once you do break above those levels thanks to paul volcker at the end of one thousand nine hundred ninety eighty eighty one in eighty two he puts us in a recession but he kills inflation and what does that start the next hyper wave up so it's actual macro economic shifts that cause these things the difference between this and elliott wave or any other technical system is these only occur very very rarely let's cut to the chest as they have about cement ok bottom line as you see it because i'm in it heading the lower to talk about that let me get my vomit bag ready sorry but i have my air sickness bag i have it here somewhere but continued tyler well i hate to be the bearer of bad news but hyper ways have got three or four great periods that can last ten twenty years to the upside just as we saw with the credit chart but then you pay the piper bitcoin for the first eight years was in a phase one of a hyper wave where it couldn't get above a thousand then it broke out above it and went through phases two three and four up to almost twenty thous

regulated now and talk about glass steagall that was sort of redone partly as as this thing called the volcker rule as part of dodd frank that changing the difference between commercial and investment banking explain where that is well where that is is that the regulators did approve a rule that became final in two thousand and sixteen you worked on that i voted on it you voted on it it's a very complicated rule public citizen and the progressive organizations did not like that rule in particular it was overly complex again this rule says that banks should not gamble especially with taxpayer backed f.d.i.c deposits they should be engaged in the difficult boring business of making loans. the the the liquidity. that was threatened hasn't really appeared and yet the banks want this relaxed and as we speak the five agencies including your former agency are busy at work relaxing that rule i hope it doesn't happen i want to ask you about the future what do you think might be the next big crisis difficult to say. if i knew i would make a beeline to the regulators and make sure there is they are aware

and it's being played out right now with this regulation it seems like because we talked about the volckerrule here that this is a continuing misguided policy in my view but that's from a former regulator who would have voted against this let me ask you one quick thing before we go get about sixty seconds there was a story today in the journal about spoofing and that is spoofing is when you put out false flags in the markets for our viewers you say you want to buy something and you immediately pull it back if you don't really want to buy it what you're trying to do is move the price either higher or lower and this news release i think it must have been from my old agency i thought was really a little bit silly because what's changed mainly in markets are these high frequency traders and i know and love a lot of them but they are trading as i talked about here in the program four to five hundred times per second how do you think they've changed markets in general these cheetah traders yes well i think to. in the markets which is supposed to find the accurate price has been overtaken by mark

high earners eight percent percent back in two thousand and three i believe been going back to paul volcker days right i mean they're in the teens yes ok so you know six seven eight percent on a mortgage that's that's completely normal five percent on a thirty day treasury note is perfectly normal for have percent of the money market is should be the normal but you can't taper a ponzi because when you buy a house there when it's at nine percent mortgage rates are at nine percent and they're going down yeah you could always find somebody who is able to service the debt so ponzi your price ponzi that but it was going to go up to there it's harder and harder to find somebody to pay the price you pay it's called default yes you default because all those mortgages remember repackaged by wall street and sold on to institutions pension funds sovereign wealth funds and then all those will get a twenty percent thirty percent forty percent haircut yes well i mean this is the news we have that we have rhinos now grey rhinos and buffaloes on the horizon as you're out there stampeding through black frid