tv Keiser Report RT June 6, 2013 9:30pm-10:01pm EDT
welcome to the kaiser report imax kaiser you know germany's longest word has sixty three letters it's officially ceased to exist of course being so long it was never in common use in fact it was so long only a computer could possibly speak it. because that's. indeed any word that takes longer than five seconds to say is just too frickin long not to fail. maybe it was so long that it failed as the headline on the telegraph germany dropped his longest word fly chevy and originally they did have been whole
thing but it ruined all of the h.t.m.l. him and c.s.s. of the whole front page of the telegraph so they got rid of it was a word that was about the law regulating the testing of beef and the interesting thing about this is in germany in theory a german word can be infinitely long unlike in english an extra concepts can simply be added to the existing word indefinitely such extended words are sometimes known as boon to warm or ter or tapeworm words and i thought this could be really applied to the financial system that they just add on concept is the same concept fraud fraud fraud fraud fraud fraud and you see that with their derivatives they get longer and longer words but the same concept is that the tape for must be fed with these additional frauds wow this is a quite a high falutin way of getting around to one basic concept we've been discussing on this show for
a while which we can discuss again based on the fact that getting rid of the sixty three word letter in germany by the way you couldn't use the word twice on a twitter because you because there's a lot of characters on twitter on a tweet but i hear you're saying these words could be infinitely long now in the case of finance what happens is that a bank like j.p. morgan walt issue let's say mortgage collateralized bonds take a mortgage you know create a security around that mortgage and then as it becomes clear that the bond is about to fail what they'll do is they'll make a from a ten year bond to a twenty year bond and instead of having a five percent coupon they'll say oh now it's got a three percent coupon and then within six or twelve months it looks like that's going to fail so that turn it from a twenty year bond to thirty year bond or a forty year bond and then they'll kick it up stairs to the global derivatives. market and you have seven hundred trillion dollars in the global derivatives market it got over a quadrillion being traded and when you were if you were to freeze frame the global
the rigorous mark and take a look at it what you would find are something like looking at ancient german text of these huge words that have literally not been used for many many years and in fact have no intrinsic. a value unto themselves because they're completely in disuse however that is the substance around which this global ponzi scheme is built so it's a ponzi scheme that's built on layer and layer and layer of what is and at the base layer is fraud in terms of words being important there's another very simple word you said ponzi another very very simple word is moron and this is a word used by albert edwards a society generale to explain george osborne and his new policy george osborne's help to buy scheme a moronic policy leading analyst says chancellor's flagship scheme artificially inflates prices and drives the young into indentured servitude is
stablished man is beginning to realize what we've been saying on the show for a while is that the help to buy a game by osborne is is another one of the is what we were just talking about you have a economy in the u.k. failing it's a ponzi scheme so instead of addressing the failure of the economy they're going to create a help to buy scheme which means that they're going to subsidize more speculation in the real estate market and adding on more debt so this is another add on of debt so there destabilizing the u.k. economy to create a bubble in house prices and this is not a recovery and that it's not right there's no wage growth wages are stagnant and in fact quite inflation now there's just been reported that the actual number in terms of inflation for food and energy as i said now for a couple of years in the u.k. it's running at nine percent not the two point eight percent of the government states so this is not this is not a his help to buy scheme is a ponzi scheme that's built on a ponzi scheme well there are some people who believe it's
a great scheme and these are the house builders for example there's actually been a boom and the stock market here for homebuilders because they're benefiting from that so what what it is is the basically prices are too expensive for first time buyers here and they can't afford the. so the taxpayer through george osborne are going to subsidize the twenty percent deposit for these new build apartments and the home builders who are going to build these new build are going to benefit as the stock market has reflected now of course as albert edward says in this report is that home prices are too expensive the problem isn't with that we need more debt that these first time buyers need more debt they're too expensive prices need to decline so that they can afford it just as has happened in places where home prices got too high including america which are cheap in many areas now he says i believe it is truly a moronic policy that stands head and shoulders above most of the stupid economic
policies i have seen implemented during my thirty years in this business irena above some of alan greenspan's very worst blunders all right so here's a banker calling osborne a moron those are his terms and we've been and hinting that suggesting that the help to buy scheme is a ponzi scheme and what what will happen is is that this will all be resolved in the form of a government bond collapse so instead of morning cameron doing the responsible thing which is to bring the economy around through responsible policies where the demand for housing would be something more organic and reflective of the underlying true economy the subsidy subsidisation of housing and i know again i don't know why they why why would they subsidise the house builders and not the n.h.s. be privatized that's that's unconscionable isn't it i mean they're just another
subsidy for another group of private contractors at the expense of the general welfare welfare of the of the country but the result will be a bond crash so interest rates will do what they hate when they despise what they fear are interest rates going on the ten year. guild or government bond going from the two percent or so to four or five or six percent but that's a guaranteed occurrence of the house pricing the houses will crash the house prices will crash and people be left with negative equity and osborne hopes that he'll be out of office by then working for the housing company that he's putting stuffing money in their pockets memory's an inveterate crony capitalist who is thinking only of his own pocket is interest is not in the interest of the general public the british people he is an inveterate crony capitalist we found and discovered that the source of many of these complex global financial derivatives that have crashed the global economy for which we have to come up with all these complex schemes like help to buy schemes are dramatic and the origin you just keep on attaching various
concepts to the end of award fraud fraud fraud for fraud you need to add more fraud more debt to the debt in order to recover the economy so they keep on adding the same concept so i want to also look at webster's dictionary and i wanted to look at some more words for more on here and case you wanted to come up with a more creative way to look at george osborne and his policy airhead blockhead chowderhead clod poll dimwit dodo knuckle head slob yahoo in yo yo. yahoo and yo yo yo yo yo yo oh i think those are all good ways to describe george osborne as the banking establishment now understands that george osborne is putting the british economy enormous risk well we were the first to say here on the kaiser report as soon as we heard of this plan we call then fathom consulting group comprised of five former bank of england economists that then mervyn king the
exiting bank of england chief now the i.m.f. and now albert edwards everybody is saying it's a moronic policy if everybody's tell you you're drunk you're probably drunk everybody is calling you a moron so you're. worse then alan greenspan who is such a snow key took down the whole global economy with these complex derivatives which are just fraud on top of fraud on top of fraud added on to the concept of fraud well mark carney is coming in to be the new bank of england chief and he's already been able to negotiate his running of the compliance divisions chair of the oversight of the banking establishment in the u.k. i predict they'll be a bit of a power struggle in the forest george george osborne i don't think i don't think george osborne will last in the next election i think he'll be dumped as the chancellor that could be true if you look at this next headline because there's a jobs fair going on as we speak building bird guest list includes george osborne
and ed balls heads of big tax avoiding firms also set to attend secretive groups for days summit being held near wofford so george osborne and his labor shadow ed balls are going up to the build a bridge group. jeff bezos from amazon is up there google all these people who are right now under scrutiny for avoiding taxes and in fact often paying no taxes here in the u.k. despite selling billions they're going up there it's a secretive meeting as you say they could be offering him jobs in fact build a bridge for the very first time ever thanks to alex jones and charlie skelton have announced for the first time ever what they're going to be speaking about and they said that the topics will include jobs entitlement and debt which is ironic considering that many of the people going up there are entitled they think to jobs and by foisting debt on to everybody around the world and what is george osborne doing with his balls. did i hear that correctly i mean i know the
guys into some kinky stuff i think we understand he's going to play with his balls balls balls balls we play with balls so they're talking about entitlement reform this is a code word they say for that. basically uppity peasants think that they deserve anything back from all the taxes that they've paid whereas we the amazons of the world in the starbucks and googles of the world have not paid any taxes but we're going to determine where going to meet with george osborne to determine whether or not you are entitled to these entitlements that you think you're entitled to look at what tim cook instead of the c.e.o. of apple computer said at a recent graduation ceremony he told the people the students break the rules and never pay taxes. break the rules and never pay taxes that's tim cook's message to the new you know the graduates coming out of america now. well we'll see how that works during the bomb crash on the global insurrection against by our occupation
and gold at five thousand dollars an ounce to. tim cook and then finally economists calls for a new global currency this is robert mondale who is a nobel economist and he's actually advisor now to the chinese government and he was in the air in the gulf and was speaking at a financial conference and he said that the dollar era had gone with the wind it's flat left. and it's time for a new global currency and this guy is the father of the euro so he's proposing a kind of s.t.r. global s.d.r. backed by the end the ruble the euro and the dollar now that's definitely coming in s.t.r. global currency what should they try to roll up its again to the going back to the top of the show that these german or of the just get longer and longer and longer i mean this will take one hundred trillion dollars of bad global debt and they're going to repackage it as a special drawing right or s.t.r. and they're going to extend the maturity to one hundred fifty years and they'll try
to just to kick the can down the road again but of course gold will suss this out and be at five thousand dollars an ounce so we'll good luck with that anyway stacey her thanks for being on the guys report thank you so they do for the second half a whole lot more. you know how sometimes you see a story. thank you understand it and then. you hear or see some other part of it and realize that everything you. are welcome is
back to the kaiser report imax guys are time now to turn to alistair macleod he's head of research at gold money dot com alistair welcome back to the kaiser report very nice to be him all right we had to have you back on because all responsible great from your previous appearance i had to ask you about this idea of gold markets are failing to clear so what exactly does that mean i think we need you to dig down a little bit into this concept and what evidence do you have of the gold prices failing to clear well the two bits of evidence the first has been placed for certainly all of this month amasses that the deliveries from the shanghai go to
strange appear to have almost ceased at least they've ceased on the information that we're given i do delivery from move to home well the shanghai gold exchange is more of a physical futures market. than comix comix basically is all gambling without very much to livery the shanghai gold exchange on the other hand actually does clear physical and it's typically you would see every month around one hundred fifty maybe three hundred tonnes even clearing through that exchange is a two way traffic some of it was going to hong kong for re fabrication for selling in china and some of it was just being bought in china for only delivery in china that appears to have almost ceased the very very few delivery notices now that you'll see on that exchange the second thing is that the deliveries that occurring on comix one wonders where it's coming from when i was fascinated to see that the i
don't know whether it's comix themselves or the regulator so that we can't indorse the the numbers in the vaults in the comix register vaults so this is the first time this was said which seems rather old i mean all they. worried that the numbers just don't stack up have the questions of the vault operators and find that they haven't got sufficient on says ok let me interesting let me ask you about the comics as relates to shanghai and also j.p. morgan apparently their inventory of gold is trading at near all time lows in their vaults i c n zero hedge off and they report on this j.p. morgan's inventory of gold getting down to historic lows but i want to talk about the comics for a second because this is an issue that's come up several times and the idea is these gold and silver vigilantes like eric sprott up in canada has been buying gold and silver aggressively. they talk about the idea that when the futures contracts
are mature and it's time to either declare previous to the expiration of a contract or whether you're going to let a roll away they're going to take delivery the idea is that as you get closer to the expiration date the players and rolling and they don't take delivery well it's very much the market runs like that but there is another aspect to it but a quick jump in for a second if they took delivery there's not enough inventory to make good on those deliveries at the point what we do see at the end of every month on the expiry is we see that say standing on an active go month could be twenty thirty maybe forty tons but that amount doesn't seem to come out of the vaults where does it go seems a very good question is it as some would suggest that the bullion banks are borrowing from the central banks well no i think for this for this particular case i mean either they're delivering it from somewhere else which could be. borrowed from somewhere else it could be from another boat i mean j.p.
morgan for example of gold falls in london the folks in singapore so they they do have means of shifting stock around right and their vaults apply to get back to them is running low what according to the the figures. yes the registered vote in america is running low but then i think there is a bigger point here and that is that you see say something like thirty tons and not to standing for delivery and how much gets actually delivered if you look at the numbers they don't go down that much anything like that much so one wonders whether the people who are seeking to take delivery somehow come to an arrangement if you like so that they don't actually take delivery it's very difficult to know and i think it's something which the regulators really ought to insist comix makes a lot more clear as to what's actually happening so to get back to the site if a link to clear this concept the price it for it to clear you need delivery of what it is you put an order in for if that water is not consummated so to speak
by getting the stuff that you bought there's a failure the market has failed and yours as you're suggesting is that we've got real time market failure and that the deliveries being cobble together bits and bobs through four sources that are not terribly clear the regulators are not being clear comix is not being dick being clear about it but if you put this together this picture suggests that the gold market is in is in a period of stress. and get into the fact that the gold exchange traded fund g.l.d. there's been a lot of gold taken out of this fund however simultaneously there's been a lot of physical buying people call it the paper gold even george soros who took money out of g.l.d. has been buying mining stocks so he actually has more exposure to gold now than ever in the last five years so this headline that he's getting out of gold is a misnomer talk about the g.l.d.
being so the paper market being sold off if you count what we don't actually know what happens to the go it's gone from g.-o. d. there are two possible answers well probably three postpones to this the easiest one which nobody high. it's a tool is that some people who have the gold in might think i'm not sure that this is safe i'm going to take it out of jail do you through one of the authorized participants and i'm going to store it on to my own arrangements that's that's that's one of them said the other officer is that there are a lot of bulls of gold who are westerners in their thinking they think in investment they have bought gold to sell is a profit in dollars or euros or whatever the base currency is and they have now been persuaded that gold is now no longer in a bull market so that is another source of selling the other possibility is that the authorized. participants who are basically the banks who. who who have been if you like of knowledge by the the managers of g.-o. d.
that they can actually deliver stock in deliver gold in return for shares out and the reverse they could well be going short in order to take possession of physical gold to meet the livery requirements so that you know their story could be connected that it could be this new home inventory story and the overall stress in the gold market failure to deliver absolutely well the thing that's driving this max in a sense is that you've got enormous premiums in dubai and in hong kong and china for physical yeah i'm asking about that tells me that the price of the you know then they're just not getting it from the markets here having to pay up in order to get it you're over there gold laid out james turk i guess or the bull work on the research effort or the head of research at goldline dot com so your blogs you know are really must read in the whole gold space and i think james turk told me that
personally that he reads your blog first thing in the morning every day that's his first thing that is really good. thank you but what i want to say is if in fact the markets are in what's called. backwardation a nation they're training a premiums for the short term people paying more than a cold spot a living so is it so if i saw my g.l.d. in the west in the western market and i take that cash i'm effectively in the asian market i can sell my gold at a five dollars premium isn't there some five dollars already you know you depending on the day you could probably get forty fifty dollars i mean the quite a premium building up and it's different in different senses or some other wrong in saying that no you're not so i can make a risk less premium on the trade the arbitrage between the two price well it's risk of us in the sense that you're ignoring the risk that your buying a contract let's say. comix and you expect that to be delivered
there is a risk perhaps with the shortages rad you're going to deliver that home premium in the east suggested that risk is real that's why there is a backward as is the point that's why you have backwardation the risk is you won't get your delivery of it all on the spot market that's why those premiums are a sign of the premium will rise to the point where the people in the market judge that the risk is balanced by the profit and that is that that is different obviously in different senses and different people have different different views there is no market if you like in the sense that people can get together and say well you know this is the market premium it is very much an individual thing it's called free market it's the free market in all this it is if you like a sort of unofficial market and it's not as efficient as it should be. or would be if the markets themselves the capital markets in the west properly reflected the demand for gold become understood that the market in the west the comebacks is
being artificially suppressed yes to support the paper money ponzi scheme that's the only conclusion we can come to now what are the geo political implications here if the west is essentially. manipulating. market so that gold tons hundreds of tons of gold thousands of tons of gold are leaving the vaults of the united states western europe and britain and going to china in the middle east there is a huge wealth transfer going on in russia who is on my advice and buying gold hand-over fist i like to see if i like. them a concurred i haven't heard back from the kremlin saying they've been doing it so that i'm taking credit for that i mean that's your watch that. anyway what are the geopolitical implications of this well this is a trend that has been going on since the mid seventy's it started with the oil crisis and you had lots and lots of arab governments with huge amounts of dollars from the hike in the oil prices and they wanted some way to put it and obviously
they were balancing the risk of all these dollars that they had which you know is very welcome because it gives enormous spending power with some go in order to balance the risk that the dollars might not be worth quite what the federal reserve board says though so that process continued it's been going on the whole time with india last time i was on your show i give you the example of. you know the indian who who in one hundred sixty five when he was a young man probably first bought gold at one hundred eighty rupees and today it's been up to ninety five is about eighty thousand rupees now i mean there is no better no better head against a disappearing rupee that is never a second because i make this comment on my my tweet stream often to people that they should be buying gold as a hedge against this catastrophe that's that's being played out in real time in response i always get back as you know we're broke we're we're poor in america hundred seventy five million people are added below the poverty line we don't have
any money we're on food stamps and i say well look at the indians they're living on two dollars a day and yet the majority of them managed to scrape together enough to buy a little gold absolutely well the difference is that the in. and there may have two or three shops he gets his savings and he puts it into gold the equivalent businessman in america has a small business maybe you know three full retail outlets in shopping malls and things like that but what does he do with his capital he puts in stocks and shares some government bombs and that's the difference so the idea that the americans haven't got money to put into go i'm sorry that's not right is the question of whether allocating it so i have to thank so much else macleod for being on the kaiser report that's very much my pleasure thank you max ok not going to do it for this edition of the kaiser report with me max kaiser and stacy herbert i thank my guests he is the director of research at gold money dot com if you like to send us an e-mail please do so at kaiser report at r t t v dot are you guys are saying bio .
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go on tell margo in g a live from new york city and here's what's coming up tonight on the big picture. president obama promised the most transparent administration ever when he took over the white house but the scandals of the past month seem to say otherwise and now there's news that the n.s.a. the national security administration is secretly collecting americans phone records and perhaps much much more so what happened to transparency in washington also yesterday president obama chose susan rice to be his new national security adviser in a move this sure to ruffle republican fathers but does the president still care about working with the republicans or.