City which have turned increasingly violent in past weeks lamb maybe hoping that the move will put a lid on the protests ahead of the october 1st golden week when china will celebrate the 70th anniversary of the founding of the peoples republic. And checking in on the brics a drama in the United Kingdom british Prime MinisterBoris Johnson suffered a bruising defeat in the 1st vote on the house of commons under his government as m. P. s voted 3282301 last night to advance legislation that would rule out a no deal exit for the u. K. From the European Union mr johnson then said he would introduce a bill for a snap election to take the issues that question to the people but Opposition Leader germy corben of labor insisted that labor will not supply the loots needed to call a snap election unless and until the entire no deal bill is passed or securely on its way to becoming law today Prime Minister johnson spoke on behalf of his election bill before the 922 committee where he was reportedly rebuked by speeches. Supporting the conservative rebels who voted to advance the bill from hilary benn of labor barring a no deal braggs it and as we prepared to go to air the ben bill had just passed a vote for a 3rd reading in the commons sending it to the house of lords. And joining us today for a special power panel across both blocks of the show are peter schiff the c. E. O. Of Euro Pacific Capital and Richard WolffeProfessor Emeritus at u. Mass amhurst and the author of democracy at work a cure for capitalism gentlemen brags that i feel as if every headline weve done as long as i can remember leads to one more now what moments and were at that point again in the cycle but while we may not know how this will end it seems we can be fairly certain that confidence in the u. K. Is political system to handle handle paul challenging policy questions and process democratic input seems have been severely undermined so my question is what is the economic effect of the one sure consequence it seems of this adventure which is loss of confidence and u. K. Institutions peter do you want to take that on. How much or how much confidence there was a u. K. Institutions to begin with and you know it seems like both sides have a political interest to kick the can down the road to avoid dealing with the consequences of braggs it but you know i still think from a long term perspective getting out of the e. U. Would be a net positive for the british i mean i think theyve been their own worst enemies when it comes to dealing with this potential way out but actually i think if they actually do something the pound my rally i mean theres been a lot the pound has gone down theres been a lot of selling it dissipates and of the potential hard braggs it so we might get a buy the rumor sell the fact and if that happens that be a Good Opportunity for the british to buy some gold. And now richard as the loss of confidence the one outcome that we can plan on and what exactly is the Economic Impact of that very intangible a very real factor weve already previously thought saudi aramco. Pulling out of their planned i. P. O. And choosing to actually i. P. O. In japan on the nikkei rather than put me in the there in london. Well it seems to me a number of effects and i think there are serious the one is obviously uncertainty which has its own consequences like the a ram co decision but there are literally thousands of other companies around the world in britain and europe and beyond who do not know how to make t. Investment decisions because they cant figure in what the consequences or even what the final decision is going to be number one number 2 britain is a small part of the world relative to the rest of europe i believe that doing what they are doing a distraction from their basic problems is going to make life for that country and the people in it worse because theyd break away that if they tried to find a more acceptable way to participate in what is one of the majored trading and investment blocs in the world and finally it seems to me that particularly since the crash of 20081 and austerity was imposed on the British Working class far more serious than almost any other country say except greece that you are seeing the building of a rage and the anger of the working class once they figure out as they will that in or out of break that theyve got the same problem of the structure of britain youre going to see in the acceleration inside britain of a very powerful class struggle of the sort we havent seen for quite a while in history has not ended sounds like moving to the other side of brags that the incoming president of the European Central bank Christine Legarde said in a confirmation hearing for that post on wednesday she seemed to offer some very mild concessions on the issue of negative Interest Rates and quantitative easing suggesting a review of the policy and said that while the quote continues to be positive we need to be mindful about the. Central side effects and take peoples concerns seriously so i already hear you laughing peter is this just the usual kind of statement that political nominees in these kinds of scenarios make so the critics can claim some influence on the nominee can make minimal changes if any in their actual position. That well 1st of all the fact that rates are now negative is positive proof that the policy is an abject failure i mean clearly it didnt work i mean youre upset over the reason that we have problems is that we dont have low enough Interest Rates and so they keep lowering Interest Rates at the problems dont go away in fact the problems get bigger and then when they get to 0 they dont question the fact that maybe lower Interest Rates is the wrong prescription for what als the economy no no no they decide they need to take them down into negative territory this is insanity we are at the end of this experiment it is going to blow up hopefully maybe some of the people over the Buddhist Bank will be able to cause the e. C. B. From this course you know they keep saying that they want more inflation they want more inflation which is ridiculous theyre going to get a lot more inflation and they bargained for and its going to be very hard to put that genie back in the bottle but i do think that potentially they may have more success at doing that then will the United States. Now richard the same question should we expect more of the same from the e. C. B. And miss legard if correct and the policy is basically a fact that. Now i think peters right about this this policy has not worked it hasnt worked for quite a while thats true of a quite a few of the policies that have been turned to in the wake of the crash in 2008 i think the real question is whether the i. M. F. Gets beyond or the world bank or any of these institutions get beyond the policies that havent worked to begin to grapple with the seriousness of the dislocations in global capitalism and come up with new ways of scuse me to intervene i dont see that so i become quite pessimistic that theyre just going to be treading water especially with the uncertainty of braggs it and the uncertainty of the United States china trade wars and the trumpet ministration all of that theyre gonna stick keep doing what theyre doing crossing their fingers at the problem doesnt get worse my guess is it probably will and back to the issue of Interest Rates you are to gurus on this issue the era of falling global Interest Rates seems to be settling in and shifting behaviors some Major Players a one data point there is apple has now started borrowing in bond markets for the 1st time since the trump tax cut theyd been on a buyback spree and they say they want this these funds to raise cheap money for more of the same buybacks are there any lessons here above and beyond one very Large Company responding to low Interest Rates peter. You have to remember that low Interest Rates are not the solution to the problem low Interest Rates are the problem Interest Rates need to be much higher than they are today and the longer Central Banks succeed at artificially suppressing them the more screwed up the economies are going to get the bigger the imbalances. The more speculation the less legitimate savings were going to have the less real Capital Investment were going to have and so were just going to continue to blow air into a bubble until eventually it blows up and richard what can we infer from apples return to the bond market here. Well i think i disagree a little bit with peter but i think on many things we do agree heres my take on it the whole point of lowering Interest Rates has always been the hope that if you make it cheaper for business particularly but also for the consumer to borrow money that the consumer and the businesses will borrow the money and invest in the real economy hire workers buy more red bullets increase production and thereby lift if you like all the boats that hasnt happened now for a long time instead the cheap money is being used not to put the real economy into gear but rather to hype up the stock market to use the borrowed money just like apple is proposing to do to buy shares of stock and to have the inflation that isnt happening in the real economy happened in the stock market getting its prices are all out of whack with the rest of the economy therein lies the continuing danger of this kind of policy peter schiff in europe you know helpful and points you know you had peter you know there is inflation and there is inflation in the real economy the government just not being honest about it but we dont want the government to try to artificially manipulate Interest Rates to encourage a we want their free market to do that and remember it takes 2 to tango if you want to have people borrowing money somebody has to save that money to lend it to them and were not going to get savers unless we have higher Interest Rates right now the government creates the money out of thin air but this is not legitimate savings this is inflation this is not how economies grow this is how bubbles are inflated and all bubbles you know burst and they have very profound consequences when they do interesting was always well get back to this in the power panel and peter schiff and Richard Wolfe will be back in our 2nd block thanks so much for your insight viewers stick around well get them on the other side of the break. Google has agreed to 100. A 70000000. 00 settlement with the f. T. C. And the ag of new york due to violations of the 1980. The company will pay 136000000. 00 to the f. T. C. And 34000000. 00 to the office of the new york a. G. The capo requires companies to obtain parental consent if they will be collecting data on children under 13 years old the f. T. C. Claim due to collected personal data from users who watched videos that were directed at children in turn use that data for targeted advertising following the statement you tube will now require can content creators to designate if their videos are intended for children if that wasnt enough of a headache for google to enter a titan is now facing an investigation from the irish data regulators over how they use information such as race health and political users to target ads a process which circumvent European Union privacy laws. And now for a quick break but stay tuned because on the other side of the break bonds are going to the microscope and all the fragility comes under scrutiny we welcome back our panel to break down what we said the headlines of the sector mean for the future of Global Finance and as we go to break here are the market numbers at the close ready ready ready. I am sure to stop at the during their grow. I just never know 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 programs. Theres no reason the more. You take things that are. On the move something. Everybodys scared to talk about it certifiable is truly dependent on us addressing this issue and if we cant even talk about it which anyone have a conversation of that it then. Were in trouble. Ready for Survival Guide ecstacy just going to start simply to. Be sure its clear you dont get it that. This is a repatriation scheme look at the last 7 years. Build a separate kaiser report. Well argentina is already struggling with a sovereign the quiddity crunch and asked the i. M. F. To restructure its debt payments there is also a 15000000000. 00 pile of provincial bonds that is threatening to saddle Foreign Investors with even more losses the nations provinces were political issue as when the International Capital markets reopened to argentina in 2015 offering Interest Rates of 9 percent yield hungary investors investors believe that these provinces had the support and assistance from the federal government and argentina wouldnt default under pro market mccree well that faces blew up last week when the government announced that it would postpone payments on the caps short term local notes that a move the s. N. P. Considers to be a selective default now Money Managers are racing to dump the debt amid concern that the local governments will use a sovereign restructuring to lessen their own debt loads many of these provinces are almost wholly reliant on disbursements from the federal government but dollars needed to make Interest Payments which only further increases the risk to creditors the countrys bonds plunged with many now trading below how their face value and to make the situation worse the debt is all. Also mostly in foreign currencies and when they collapse in the past so many provinces dont have a large dollar revenue stream the province of. Half of all the outstanding prevention of debt and is seen as most likely to default given its significant foreign currency obligations and the weaker credit metrics. Italian government bonds surged on wednesday pushing yields to record lows a point 83 percent on the 10 year investors are now placing bets that the new Coalition Government will avoid confrontation with the European Union over the blocs budget rules and expect a more conciliatory tone towards europe members of italys 5 Star Movement voted overwhelmingly in favor of forming a government with the center Left Democratic Party with nearly 80 percent of 5 star members voting to back Prime Minister just up the conti 5 stars forming a new administration with former foes from the Democratic Party with an expansionary 2020 budget at the top of its agenda to help the stalled economy grow with large chunks of the eurozone now trading at subzero yields italy looks to be relatively attractive to fixed income traders italy currently accounts for 62 percent of all eurozone government bonds with a positive yield as the market has been supported by expectations of renewed bond buying from the e. C. B. As early as next week having agreed on the outlines of a Coalition Pact the 2 sides still have to decide on ministers with uncertainty surrounding the role of 5 star leader demaio. And now to give us their take on the turmoil in argentina and italy we welcome back richard wolf and peter schiff. Now peter the results of the election we just heard the political maneuvering we just discussed in italy the 5 star ballot was actually quite strong but this isnt enough to give investors confidence in this new coalition its a lot of shuffling chairs but only still has a 2nd largest debt burden in the e. U. Will they be able to be able to deliver an acceptable budget. Well you know i i wouldnt have any confidence at all in loaning money to italy or any other of these european nations at the low rates of interest that are currently being offered i mean they dont reflect the type of inflation that the eurozone or the rest of the world is likely to experience based on the amount of money that is now being created by Central Banks and how much money theyre going to create in order to artificially suppress Interest Rates so they can continue to pretend that they can service an enormous amount of debt that has been piled up so nobody should be buying any of these bonds theyre a lousy deal for everybody people we should look like should be looking for alternatives thats why the price of gold keeps going up thats why the price of silver keeps going up its better just to stack gold and silver and put it in a safe and then lend money to any of these government said negative or barely positive rates of interest. Now wolf while italy is on a temporary upswing now argentina is in crisis again and usually at least as weve seen in history when a sovereign borrow gets into trouble and experiences a rollover risk and they cant refinance material debt due to a sudden stop in the market financing a policy choice must be made and we can either monetize the material debt and sen