Age they were entering the workforce at that time and that was a massive population so you could create a ponzi sort of scheme heres a headline to prove my theory that what were seeing right now is a kid in to back at the assoc not in the collapse of the asset not in the strife that followed the reign of terror that happened here in france banks are now referring people to food bank to help them pay their mortgage this is in australia so its called food bank South Australia has been approached by banks tree for their clients to the charity in the hope that it will prevent people from defaulting on mortgage payments not let them eat oreos but let them eat food bank this is a real up to me moment and another replay so its got a couple of almost verbatim replays of the revolutionary times of france and not only are they collateralize ing property. As you point out its no fat is nothing reinvented here its all property back and now instead of letting them eat slices of brioche theyre allowing the folks to use their foods to know theyre subsidizing the food banks they were bank will food so they dont default on their mortgages these are normal middle class upper middle class and even indeed upper class people but theyre stretched they have 10 x. That they might be earning a 1000000 or so their dollars a sisterhood bank to get to them food coupons so they dont default on their mortgage theyre calling it vouchers these banks the bank you have a mortgage with the bank the bank is concerned that you are not able to meet that mortgage because your income has not gone up and the prices continue to rise so theyre creating vouchers that they give to the. Virtual reaction virtual brioche token as it were as a child care and i see oh yes of brioche yes on the if theyre in block chain its in the r. C. 20 token and theyre throwing it out see we found a use case for a theory and finally say its halleck it can be happy so here again we had. 10 years 20 years and australia to feed this property bubble there to keep that going because if youre not working in the commodities business in australia then youre your property speculator and you have the asset now so heres the unusual situation food bank South Australia chief executive Greg Pattinson told a. B. C. Radio adelaide it was still exploring how the program would work quote thats what were exploring with some of the banks for the moment it hasnt started yet because we are still working through the process weve never been approached by Financial Institutions in the past and the banks to their credit are doing the right thing in trying to find a way of keeping people in their houses now in the Medieval Times you have the church and they have a lot of property and here you have the church of Central Banks and theyre treated as saints an apostle they definitely are infallible banks have been determined and deemed to be infallible they are not punished by anything there is no mortal that can ever punish them because they say this with knights and our whole fabric of society and the system around us would collapse should we question today that too big to fail yes like god gods too big to fail or the sector but this is what they said at the time pre french revolution that they were infallible these corrupt. Priests that were wandering around europe at that time you know they were shaking down people for indulgences and nevertheless here we have another let them eat brioche moment and i want to turn to another part of this this trying to sustain this acid not system that we have around the world and you had predicted here in christ report that cutting Interest Rates down to 0 and then to negative that it would cause deflation and heres a headline from bloomberg Central Banks negative Interest Rates were supposed to increase spending stop deflation and stimulate the economy. They may have done the exact opposite so this is based on a study from the university of bath in england and you had to wait 10 years after kaiser report told you this would happen and here theyre saying yes they dont credit us but we were right writes partridge men and Danny Blanchflower another economist and former central bankers argued that this type of money printing would create inflation however what it did was it kept a zombie banks alive and they pushed out companies that could create actual jobs and innovation and genuine taxable inflation Economic Activity and by catering to the zombies of the zombies got bigger and bigger and as such became a black hole of debt so the black hole of debt the cheap rates of negative rates are increasing that black hole of debt in thats deflation and now negative Interest Rates are soft default on sovereign debt thats also the pleasure but again go back to my theory that this is an asset not they were never ever going to lend to businesses businesses dont exist in this world where financial ice world what they ran out of was greater fools back in the 1980s when we began this bond market bubble when Interest Rates were at 20 percent and now theyre down to 0 and even negative what we had always was a greater fool to roll over your debt who could back in the eightys you had to you know take out a mortgage to 2 and a half times your income you had to put 20 percent down then they cut the that down to 3 percent down then to 0 percent down and even they would pay you to take a mortgage they would give you the deposit essential and they would loan you the deposit and add it to the mortgage so you came up with that then you could always roll it over and well because Interest Rates are lower now than they were in the eightys you could act you dont need to just borrow 2 and a half times your income you could do 5 times and then 7 and then in Central London is 12 times. Your income so theres always been a fool willing to say ok ill take out 12 times my income what could go wrong because i know in a few years time maybe somebody will do it for 15 times but that full never came along right to your point so the lending is spent to property and Property Assets are collateral izing ever greater lending into ever grading misallocated resources into inflated property bubbles yes this is iceland you know iceland the banks lent to the property markets they used the collateral to create this enormous bubble and then a pop in the entire country went bust this is being done on a global scale what we saw in 2008 the world came to a crashing stop iceland went under ireland was faced with near extinction there was this huge multi 100 trillion dollar bailout and now were at the end game about where the Property Values that were inflated to these incredible values where youve got the Citadel Hedge Fund ken griffith buying a flat in new york for 280000000. 00 right so you know if they all shorted heres the titanic is the World Economy is the titanic in 2008 it hit the iceberg. And started the saying and heres ken griffith with his 280000000. 00 it goes up in value. Ok what has perpendicular r. T. Thats a does for a now well we reach to a shortage of fools thats whats missing in the world we need to grow more fools and in fact in the United Kingdom when you know theres a help to buy scheme and member George Osborne introduce that in the u. K. His mom loves the program and the fools that bought that are using it love the program but other people like chi is report might suggest that was a ponzi scheme we have the us like now out and where are they doing with a help to buy scheme 6 years after we call that a ponzi scheme but the fact is the governments having to say well now you could take out a 35. 00 your mortgage for hes member thats how we had greater fulls you had less the posit down you extend at the mortgage 3 time and you lowered Interest Rate so now or apa and game we know what happened in france may be this could well if you look around the world the see the on arrest that its the beginning of that sort of thing when the assoc not falls apart right instead of having one revolution and france or in the Russian Revolution of the american im a lucian him a global insurrection against bank or occupation giago right then theyre all one joining on forces the g. L. A. Shell well join forces with the folks in hongkong when full courses an arab nations and its us all the arcing not essentially that on what they are is going around a c. E. O. Us an yod fia curse e titanics last night mare so we got a lot of a 2nd half remember statement. I. Ready ready ready ready am sure to stop at the continuing to grow. I just never felt very good about the idea of bringing children into the world because i didnt feel like things were in very good shape that a life was just going to be a lot of software program. Theres no reason the more. You take things that are to me the theres no reason to make Something Else that. Everybodys scared to talk about it certifiable is truly dependent on us addressing this issue and if we can even talk about it if we can even have a conversation about it then. Were in trouble. Ready when lawmakers manufacture consent to instant public wealth. When the ruling classes project themselves. With the financial merry go round lifts and be the one percent. We can all middle of the room sick. Room in the real news is. This is a sticker from the old water bottle phone. The stomach of a fish the brand is part of the Cocacola Company which sells millions of bottles of soda every day the idea was that. The litterbugs. Industry should be. The company has promised to reuse the plastic. On. The mountains of waste only grow. Welcome back to the kaiser report im max kaiser time out of turn to mark the lack who publishes the annual in gold we trust report were going to get into this massive tome quickly marc walk im grateful to have you on now youre from lichtenstein 1st of all i like the way you say like the mistimed how do you say it listen the. Affair like im in a crazy movie something well we are in paris you are from vienna so youre austrian. In more ways than one many of our guests here on kaiser reporting busy who watch the show call themselves part of the Austrian School of economics are you an Austrian School of economics person or what does it mean to you well i would say so i mean its quite important for our develop and test been very deport important the Austrian School of economics i think helps to really see that there is in the term the 2 for way to view the Monetary System so its not only central banking it doesnt have to be central banking necessarily but like mainstream you cannot mix just takes that as a given and i think thats perhaps one of the biggest atlanta just if one studies the Austrian School of economics just that one really realizes the can be another way and the central banking may not be the holy grail for a day or big fan also of the big standard that book saved in the most i am yes and he goes into detail into his view of the Austrian School of economics and hes a real he really hates keynesians and and their idea of printing money ad infinitum into that point there are over 17 trillion in negative yielding bonds in europe in what school of economics is this or do negative yields defy the laws of time and space and finance and other words. This is definitely not Austrian School definitely not i think its basically a function of that based momentary system which we have which basically. Brings us to a point where we have an ever expanding amount of that and then we need to central bankers to kind of try to inflate the way out of this and we lend that at the point where were pretty much at the end of the road in terms of. Youths into in terms of Interest Rates and we really need to know that the central bankers have to really try to reflate the the system in a new kind of way and theres all kind of interesting debates going. Currently which is quite interesting to follow i think we are at the verge of the new period to go with this reflation will really hit the new. Laid to very little start of others a little bit of face so inflating out of debt so money is constantly created to pay down the debt that youre creating and you create more money to pay down more dad and theres a vicious cycle and if you know it we know because they cant tell a fact if youre a friend of the banker and youre the 1st in line to get that fresh money you can make a lot of money in buying assets you know you can buy a chalet lichtenstein you can buy fine art but if you are not part of that group by the time the money gets down to you youre paying more for groceries youre paying more for gasoline so you experience that Price Inflation and it creates us an enormous gap between the haves and the have yachts and the have nots right and but this negative rate seems like more of a defaults an outright default on a bond then an attempt to inflate ones way out of debt i see you nodding your head what do you think you know i think one can make the argument that its kind of a. Soft the fold i mean you get you know 0. 09 on the dollar bagel even less if you have a negative one percent so thats basically a partial default sure but i think the main intention is really to push this currency on force and really i mean in switzerland and least on where we have the swiss franc we have pretty negative Interest Rates already and this is a huge huge problem obviously for us that managers for for all these pools of funds they really need to do something with. Or obviously they missed that in equities bones less and less in the 2 and a tiff Corporate Bonds listen listen no 2 on the t. V. And once this kind of hits the u. S. Dollar i think really that this really an interesting environment for gold and bitcoin you know its almost like statutory financial all crime being foisted upon lets say Pension Fund Managers who are obligated by law to buy Government Debt if that Government Debt is a negative yielding debt its a negative Interest Rate that they have no choice they have to buy that debt even though it means that theyre bankrupting all these pensions and so where do they get away with this because the social contract you know where in europe right now we are in paris where in home of really the whole idea of the social contract and the idea of the enlightenment and if the social contract is broken according to john locke the people must revolt you know were seeing that we see this is all we see in hong kong weve seen occupy wall street weve seen this all over the world what we call the global insurrection against banker occupation would you would you put it in those terms i get asked this question because we are near or its a bit of a highfalutin question but however is it a. Break in the actual social contract that is girding society together i think so i mean quite a few indications that this kind of social contract in germany its called to get other to once fair to the uk which is also quite interesting work is somewhat breaking down and people are also losing tons of the trust in this social contract i think one of these indications also would be like dropping birth rates so people really have to take care of themselves if theyre one to live that kind of life with which they were used to growing up and they really dont know how to manage that was like 2 or 3 kids even lets where youve got birth rates was scratching at one actually in germany and even in countries like like france and spain which traditionally had. Higher birth rates that these birth rates have been shining during the last 10 years especially so so thats one of these indications in other indication i think is the whole crypto phenomena which is obviously embraced by the Younger Generation more and and they think ok who knows if really this whole field system collapses down the road when i when im in my pension age i may be able to save myself from economic point of view if i have a few bitcoins right so thats also i think a part of this mistrust in the social contract right well lets turn to this mass of report last seen a lot of reports on monday but ive never seen a report like this its huge and been through it and every single page has some good stuff in it incrementally as the company anyway if you get this by as a p. D. F. Yes it or they can contact i guess the name of the report is gold in the age of a roading trust the very thing were talking about dollars now on the upswing all of the institutions as the family as you just mentioned banks things that are. The social contract these are all dissolved in real time and this is now reflected in the price of gold you published just in may in just 2 weeks ago mark carney confirmed this trust has gone globalisation is over what next for what people are familiar with and that is fear out money fiats currency like the dollar the euro i think one has to differentiate very much when one lives so which kind of culture one has in terms of currencies we say we in Central Europe for instance in switzerland again and austria germany we were brought up with a relatively stable money and relatively stable purchasing power which is declining no not perhaps in terms of consumer Price Inflation but in terms of purchasing power of real estate so people now starting to question a little bit. The system also from from the field money side if you are on the other side living in south america or living in the middle east i think youve got a completely different. View of money you already were much more skeptics and so the eroding trust which we this report also mainly refers to i say western societies which still had generally the feeling that this is a stable system but this is i think now also on this way down lets talk about the e. C. B. The airplane central bank its really mostly the old. Bank right and it became the central bank its german germans the biggest economy in europe and its basically just the germany is running the show and yet member a few years ago when people were aghast at the Balance Sheet expansion of the fed and they were saying well this all never had the easy pay it. Hermansen germans would never allow this type of monetary mad nests and yet they certainly want to have did that and now the results are pretty obvious i mean i would think the german people. Are starting to get a bit nervous if not quite upset about the germans definitely a nation of savers i mean also that is declining a little bit busy but still it does is more in the genes than in other countries and savers in terms of saving in the bank account and not investing so so they really get a problem if they have negative Interest Rates so they were kind of ok with Interest Rates which theyve been living with for quite a few years actually so thats in real terms negative Interest Rates anyway but if you want to see a phenomenally negative Interest Rates then then people really think. Im not happy. So that would really be i think the point when when when a broader potentially a broader wave of unhappiness regarding the c. P. Will rise the key word in all this course is trusts trust is the key word and you know in crypto and big coing trust is a big word because its trust. Trust isnt needed the transactions are solved verifying you dont need a 3rd party to apply that stamp of approval and in this in this report gold in the age of eroding trust you put big question right up there with gold its especially gold and because in our together in your view of how to play this collapsing a world of collapsing trust. Yes i think its important to to not neglect generally the Technological Progress which is going on on the crypto currency side generally which is obviously also being followed. And try to being taken advantage of from Central Banks so so so its just important if you really want to see the whole picture too to follow whats going on but when it comes to bitcoin. I mean this this discussion is always interesting one of the. Bitcoin versus gold gold is. Obviously a physically metal its an internal metal its just never dying and bitcoin is a man made system so so that would be one fundamental difference but then again from from a from a term of money bitcoin one can make the argument is that even the ha the money of the gold in the medium term so so it would be really an interesting measure of value so i think one needs to follow it closely right where in interesting camp being both gold coin were going to talk about thats the more in another segment if you can hang on but thanks for being on this episode of the kaiser report thank you well thats going to do it for this episode of the kaiser 4 with me max kaiser and stacey however like to thank our guest mark of alec. This is the thing youve got to get the p. D. F. Its very few lets get in touch with us as kaiser report on twitter or mad as report dot com and i stand by ill. Bring the grid to princeton which are old enough to remember that it was. There wasnt it was you know much worse objectively. But there was an expectation of the things we do to get better. There was a real sense of hopefulness. Isnt today todays america where shaped by the 10 principles of concentration of wealth and power. Reduce democracy attack solo down engineer elections manufacture consent and other principles according to no on chomsky one set of rules for the rich opposite. Thats what happens when you put her into the. Narrow sector of wilf which will is dedicated to increasing power for chills just as youd expect one of the most influential intellectuals of our time speaks about the modern civilization of america. What politicians do so. They put themselves on the line they did accept the reject. So when you want to be president. For something i want to. Have to go right to the press this is what before 3 of them all cant be good. Im interested always in the waters about how. This should. Visit this is a stick for the water bottle phone in the stomach of a fish the brand is spawns of the Cocacola Company which sells millions of bottles of soda every day the idea was that lets tell consumers there are the bad ones there the litter bugs are throwing this away industry should be blamed for all this waste the company has long promised to reuse the plastic. Seats to cook out some 6 feet so. That seems cool sets their glasses chris takes a close ally and i need to stay on your phones at a special projects funded he tells the defense im. On im your best at this. The end of and footy teak love fun now no mountains of waste only grow hya today and there are good tennis and mad dead in its them bad at it is sad those in me and then who the United States deems to me a threat the looked at it is so those award in syria the cia and the u. S. Military were engaged and covert actions really throughout the world where they were assassinating populist leaders they were backing up right way militaries when toes funding in our means and death squads theres no cones and in more because theres always a small col conclude for a really going could this trip profit look look. There i was in the. United states could potentially be smuggling tons of weapons and ammunition to militants in syria according to leaked documents obtained by journalist. The host key leaders for major on the 2nd day of the Eastern Economic forum in front of all but the Iran Nuclear Deal and on fridays high on the agenda. And he would report highlights the role of the us britain and france and alleged Human Rights Violations committed in yemen. There are certain. Well known to be supplying weapons that includes the United States that includes the United Kingdom. France 3