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tv   Keiser Report  RT  November 15, 2018 3:30pm-4:01pm EST

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ok see that i know is that your body also look at the motor on your body it's to flow it's almost home for most of us just just the fluid soles of. the moon for your. move. to. make this manufactured consent to stick to the public well. when the room in clusters protect themselves. in the final merry go round be the one person. nor middle of the room six.
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this is the kaiser report the show that takes you deep into the enchanted forest. and the steps you. see him acts i just want to start with the char and this is the g.e. market cap going back to the eighty's this is the eighty's this is a mini this is up to two thousand spike and the beginning of the hollowing out of
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the entire u.s. economy in fact if you look at a lot of big multinational american companies you'll see that sort of pattern this is the beginning of the share buybacks the plundering of the assets that had been developed by the company for years this is the beginning of course of financialization also happened really kicked off in the mid ninety's that released some shareholder value for a moment and then it's been plunging ever since so it looks like g.'s going to go the way of the dodo bird very soon you know when this bull market is over and that looks like is fast approaching that chart will be its epitaph. that's all you need to know. general electric there's an old saying on wall street as general motors goes so goes america well that's not true so much anymore but with general electric it is true it's one of the generals general electric general motors and that is an example or a chart that shows what happens when
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a company is engaged in pure financial engineering and accounting fraud for the benefit of the c.e.o. and others of that ilk at the expense of shareholders the expense of workers the expense of the financial integrity of a nation that's the death of a nation financially engineer by jeff l. mult and his predecessor who i can remember as a many more and the current guy who is a guy who is very famously read the verdict and he's the one that sets the motion of course he set this in motion the spike on us financial engineering it certainly excited shareholders who got some of the dividends that extracted the the wealth of the company yes well it created a whole group of billionaires but that that those billions recreate at the expense of the bible corporation an integral part of the american economy that's now going
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bust because remember it was also bailed out in the two thousand a crisis because general electric is mostly profitable b.s. of the its financial arm its lending facility its trading desk on wall street like so many corporations and in two thousand and eight it was about to go bankrupt but stock got down to single digits they cut the dividend i believe dollars and now it's back down there it was bailed out even though it should not it should have been allowed to die then but this is moral hazard is a moral hazard is the federal reserve bank comes along and bails out all the losers it's anti-capitalist is anti free market it's. not even doesn't even qualify. as america chronically as communism i mean this is clipped crap to zone where it's just a corporation with very wealthy c.e.o.'s very well connected in washington but a gun to the federal reserve's head where there's ben bernanke here janet yellen or alan greenspan and saying print fifteen trillion dollars or you know the country's
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going to get whacked in two shots to the back to you know. we get it we get the image but you know the fact is they will perhaps in the next headline find some hope for their own stock price defense contractors unfazed by democratic gains as republican deficit hawks lose influence the companies that make jets bombs an aircraft carriers for the u.s. military are telling investors that the defense business will still be booming under a democrat controlled house of representatives even as a split congress threatens a return to partisan gridlock the defense contractors namely raytheon chief executive officer this past week was telling shareholders that it's great news that the democrats are in congress because that the money spigot will be open for them they'll be getting a lot of money of course. you know in most parts of the world it's not considered progressive or liberal sort of economics and politics to be bombing other people
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but that's what they're suggesting is that the democrats are very happy to go rescue people around the world by killing them five hundred thousand people dead in yemen even more dead in iraq all of these are like supported by democrats and raytheon is saying that this will be a good thing you know his ads that they buy between rachel maddow is commercial breaks those will do well in this economy couple of good points there in the m s n b c crowd is funded by the military industrial complex so they're not quote state run but they're run by the pentagon was well they're run by. raytheon there financed by raytheon and raytheon here is saying to their shareholders that democrats they're a political party who dispense taxpayer money and they're saying that that taxpayer money government funds will flow to raytheon and raytheon then continues to buy more ads on m.s.n.
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b c that's there's a middleman between rachel maddow this program and the u.s. department of defense and the government but here in the ok race leon is the middleman between the out right but it's a private corps pentagon run media outlet and most of the scene there at middlemen called raytheon the second point there is good on that the democrats are really the war party because they believe in infinite deficit's right i mean the end where the republicans and least make a knotting reference to the fact that actually you need to balance the books and maybe it's a waste of money they have another concept of hard money occasionally which serves them well whereas the democrats are always about there is no such thing. as a limit we can print and that extends to the war machine and that's why hillary clinton is a warmonger and the democrats are easily conned into spending trillions of dollars in the defense industry and why they control the house defense stocks went up they
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mean is there any clear indication that the democrats are the party of war this is the c.e.o. of raytheon and i'm going to rescind quotes from him because the fact is that three of the biggest deficit hawks in the house of representatives which who are republican tea party sort of guys who did hold up previous budgets for defense spending they wanted cuts in it but this is the c.e.o. speaking in chicago he said one concern that we did have was relative to deficit hawks chief executive thomas kennedy said at the robert w. baird industrial conference in chicago and it turns out that most of the deficit. hawks are in the house and on the republican side he went on to say that the democratic takeover quote changes the equation relative to conversations around the national debt the environment is actually nice now because it's settled we know exactly what it is the uncertainty has been taken out and we know that we don't have this issue with the deficit hawks moving forward so we're actually very very
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optimistic can i insert a little side note pertaining to a long running contention regarding this deficit hawk and military spending it's interesting that the deficit hawks are republican and now with the democrats in the house they're going to go spending willy nilly now donald trump the president states the one way to do an end run around this democratically controlled house will spend another few chilean dollars of taxpayer money go to foreign countries and kill babies is to pull out of nato which is something the overtures again in france with trump at the world leaders for the world or one centennial celebration maybe again the point that we don't want to fund nato anymore and that's going to be a huge saving so the democrats can fund lockheed martin marietta and all the war contractors all they want but trump saying ok we're just going to pull out of nato one thing that has animated the democratic base is the. you know the militarization
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of the border which is a bad thing but it's so bizarre to me as kind of an outside observer of these two party system is that they don't seem to care that what raytheon actually makes what like things like tomahawk missiles that they seem to think they genuinely have no. impact on the ground when they drop like that there's no dead people and dead infrastructure annihilated infrastructure that a connelly's in the middle east are ruined like it is just seems a weird disconnect between the two sides that they can care so much about one set of children on the border with mexico but not another set of children and say yemen it just seems so weird disconnect was a good part of this are hypocritical regarding to hillary clinton's image of a tomahawk that explodes and lollipops and sunshine come out of the copy of the constitution is passed around in the join hands and sing kumbaya ok but again
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here's another here's an investment letter that went out also right after the midterms and this is from jeffrey's investment and again they see the democrats holding the house as really good news for defense contractor shares and just think about that for a bit like what that means and what they're saying but you know i know most people won't because they're partisan and wednesday morning note to investors and title it's always a party regardless of party jeffries investment analysts she. noted the two thousand and six midterm election which democrats seized the house at the height of the u.s. war in iraq defense company shares climbed an average of eighteen percent during that year i guess you could expect defense shares to go forward i know g.e. does do some defense work as well so perhaps that will rescue in oh the company for a bit but of course with the money they make they'll just buy back more shares and
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hollow out the company and and. no obviously you don't really have to compete if you're connected to the government if you're a defense contractor you don't really have to innovate so i don't know if it will rescue g.e. in the long term certainly in the short term you could have a boom thanks to the democrats now willing to dispense money to go fight some more general electric is a scam going that claims to be a utility coin but in fact it's an unregulated plutocracy and yet if it probably will rebound on the death play and does pay hefty dividends and some hedge fund activist has fun ways to call green mailers back in the eighty's will come in and build a big position and it'll be the story and they'll make some money but remember at the end of those profits are dead babies actually g.e. shares are down over fifty percent this year and ameritrade and other online brokers discount brokers were retail investors go in robin hood and those sort of
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apps were showing that it retail investors were the number one buyers of g.e. all the way down and now they're the number one sellers so it doesn't make sense that they're selling to somebody and it's probably hedge funds building up big positions and then lobbying democrats to give g.e. more money well it's the end of the year so you've got to sell your losers for tax losses they have a so-called january effect when the tax selling is over some point the next day week still be a rebound so it will make easy money and the babies by g.e. on the tax selling loss low and play the january effect. well it was i'm not sure that these were sophisticated investors doing their tax losses at the end of the year but they held on all the way down and now they're you know the good thing is they will have tax losses to write off perhaps against their bitcoin gains that they sold out exactly it's a winner all around you got to take a break but when we come back we're going to have much more coming your way so don't go away.
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blushes and thanks to the cica total more on the beach he cuts a host for each team you'll be sent it's not that each institution since that always shifting against. them into. the utility bills you know it's a key ingredient at least they knew it but he has a bit over most of them commenting that in the scheme you do show. that you believe . in the small to the such craning his or stow them the t. . summed up.
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what you called the british mr bliss time imo sure you. join me every thursday on the alex simon show and i'll be speaking to guest of the world of politics sports business i'm show business i'll see you then. welcome back to the kaiser report imax keyser time eh to go to chicago and talk to mr shed lock of mis talk dot com miss welcome back they always a pleasure to. get into it stock markets have been plunging perhaps not yet on the
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two thousand and eight scale but we've seen a huge losses in the fact stocks in particular that would be facebook apple amazon netflix and google is this a normal correction or recession on the horizon what it what do you think right now it's it's an earnings scare of course i do think recessions are coming up but i don't think those fears have been built in yet ok i just did a poster chart apple's down about sixteen percent or something so you know we're nearing what they call bear market territory here at. down twenty percent but if you look at a monthly char these declines of just barely started on a cyclical e. adjusted b. basis cape here. and bit by by show or stocks are
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more overpriced now than they were nineteen twenty nine and only period that beats where we are now right now is pretty much the tech bubble so we're ahead of the housing bubble right here i don't think people see what's coming it's going to be pretty brutal max all right i'm just looking at general electric hitting new lows and there's a company that is a bellwether for sure and they were engaged in a lot of stock buybacks and other accounting tricks doesn't seem to a paid off in the end but i want to move on so oil prices falling at a record pace miss what's that telling us about the global economy. there's a lot of headwinds here first off china's slowing europe is slowing we've got bragg's it concerns we've got elite concerns so far the u.s. market has managed to shrug debt stuff off for the most part but max i mean this theory in two thousand and seven was that if you recall china was going to
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de-couple from the global economy i looked at that and said that's absurd the theory now is the u.s. is going to do so max didn't happen then and going to happen now let's talk about the bond market for a second so some are suggesting that the credit cycle is turning down that's after a thirty seven year bull market in the bond market and you know if it could be over finally. and that would portend interest rates possibly entering into a secular change that would be interest rates rising for a an extended period of time was is one possible outcome this is the biggest question in global finance by far it's a question that many have got wrong for many years calling the top of the bond market knowing to be fooled by mr market so i i ask you mash to weighed in on this
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one is this the end what are your thoughts it's possible if we look at what trump is done here with the. deficit if we look at it with the fed hikes we've had here now. in a few years we're going to be paying more on interest than we are on trial runs for military spending that's the parents were on. if we sink in terms of how the fed is going to react when the next recession hits i think there's one more wave down here in bonds bond yields and that'll be the end of it you you won't want to be on them there's a decent case for saying you know what i don't know i'm just going to step aside but actually i find long term bond yields attractive here just because
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i think the global economy is slowing the fed's not going to keep hiking for ever and that's that's what's pushing long term yields up right now to your point there the interest on u.s. debt is that over five hundred billion dollars is for exact it's a rise to nearly a trillion dollars and. that is certainly going to be a drag on the economy could is serve the line item on the budget from the military spend certainly going to be an enormous drag on the economy but the rise in rates over the past year or so has basically primed the pump so that the fed and various central banks can come back and do q.e. for effectively quantitative easing for so if i hear what you're saying correctly you think that there's the probably the odds are that we'll see something like q.e. four was one last hurrah and that will be extend this bond market
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rally a bit more miche and there will be my call like i said i mean we're all guessing here max. a lot of people claim they know where things are going. i've been one of the perennial bond bulls and correctly so i mean people were predicting hyperinflation for so many years. it's clear that's not going to happen at least in ears still you know how many of these times any of these calls that we they all by do thousand and twelve idea they're doing i do thousand and sixteen for sure the problem with all of these forecasts is everybody looks at the u.s. as if it's in a vacuum but if you look at what's happening to the banking situation in china. in europe particularly in only they have more leverage than us
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the italian euro banking system is insolvent at sixty two percent of the of the dollar index here so the idea that the dollar is going to crash and interest rates are going to start soaring resist too many other problems oh swear i think max for that to happen now bought on the other hand i do think our global financial crisis is coming it's not too far off we're going to see where it starts it could start in china could start in japan right now. what's kind of like in a leader that's a lot to unpack their mash them let me take take a look at it again while you're saying so in other words. the dollar is rallying the dollar is moving up so that would would suggest that there's still a flight into the dollar by some of these other economies that are suffering. bigger
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problems than the u.s. so on a net basis you've got the u.s. with trouble but ron relatively speaking it's less problematic is still with the most fingers you know sudden speak so it takes take that into consideration for the mom it and the idea of inflation or hyperinflation never materialized because the credit market the bond market these other economies is collapsing faster than the u.s. is printing money and the net the net effect is deflation and we see that in arising dollar correct yeah you look at what the fed did the friend bernanke he came they had as armageddon said no scenario you went and preached you know demanded congress allow him to pay interest on banks. max you know and i know that that was to bail out the banks so look at what he did so we've got to pay interest and it's free
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money to the banks right and. the just hundreds of billions of dollars every year. meanwhile over in europe mary o. draggy does something completely different he cut interest rates into negative territory so meanwhile the they've launched a q e in in europe loaded up on all the assets lot of the money out there and then charge banks interest on it so burn iraqi backhandedly bailed out the us banking system burn iraqi exasperated the problems in the. bar with negative interest rates i'm not saying i agree here i don't think we should have bailed out the banks they all tried to do it but guess what bernanke he succeeded the u.c.b. failed max yet an interesting side note from that bailout history hank paulson was
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against this all bailout of citibank at the time he wanted to nationalize citibank we find out it was barack obama who rallied to the defense of the big banks on wall street a lot of people don't understand his role in that particular part of financial history and also i should note that the swiss national bank just sold from what i understand they're apple holding they had a very large business and apple stock they've said they're selling that stock central banks have been buying stock unusually now they seem to be on a winding that stock that could put some downward pressure on the markets if they start on why these positions what about gold mess it's not doing much except trading treading water any thoughts it's been turning water now for almost two years z z. it's started to rally
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late two thousand and fifteen i think that is certainly that's when gold miners bottomed and they took off and many are two and three times a head some of the juniors are four and five even more times ahead and they goldcorp is a just a there's some real problems there somewhere because it's hardly rallied at all but outside of that gold is pretty much a reflection on faith and central banks you know people look at it as an inflation hads if you asher if you pull up charts it's not if you compare the price of gold to. the 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 in 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
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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 are going to control gold rose all the way to nine hundred box they burn akki came out with the statement right about that time is that 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 fifteen or so faith and central bang. thanks again came into question i think it's going to come into question again back
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they know what will the question is is timing and as soon as the fed doesn't get as many rate hikes price stand. yes as they have i think that's when gold really lifts off for the next time right well it's interesting that america's biggest creditors although you know some are speculating that there's a lot of faith in the dollar they're buying gold anyway miche we got to a close it out there will maybe have you on for another segment thanks so much being on kaiser report max always a pleasure to be on the as usual i'm ready for another segment right now oh that's good news mish well that's going to do it for this edition of the kaiser report with me max kaiser and stacy ever like to thank our guest mr shand block miss talk dot com if you want to catch us on twitter it's kaiser report until next time.
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so we've got to do is identify the threats that we have it's crazy one sunday shouldn't let it be an arms race. spearing dramatic development only i'm going to resist i don't see how that strategy will be successful very critical time time to sit down and tom.
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twelve euros fifty a month. is prime minister treason to get. this key members of the cabinet including the man who helped negotiate the. peace to consider the national interest and backing the withdrawal agreement represents a huge and damaging the deal that is already. in the water.
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has joined forces with so-called moderate syrian rebels to fight the government in the.

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