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[maxkeiser]

Run time: 26:38 https://www.youtube.com/watch?v=00uCbUWG9aE   Posted on YouTube: October 05, 2010 By YouTube Member: RussiaToday Views on YouTube: 302   Posted on DU: October 05, 2010 By DU Member: maxkeiser Views on DU: 1248

 
'Europe experiencing financial terrorism'

Tue Oct 5, 2010 2:32PM

Interview with Rodney Shakespeare, professor of binary economics in London, Max Keiser, journalist and broadcaster in Paris and Rollin Amore, executive director of Oppenheimer & Co. in Washington.

Millions took to the streets of Europe in protest against austerity measures to hit public spending and services across the continent.
Millions have taken to the streets in Europe to protest against austerity measures to hit public spending and services across the continent -- something Europe has not witnessed in recent memory.


The Eurpean government say such measures are the only way to come out of the high debt and financial crisis that they are in.

In this regard, Press TV interviewd a professor of binary economics Rodney Shakespeare, journalist and broadcaster Max Keiser and executive director of Oppenheimer Rollin Amore.

Below is the transcript of the interview:

Press TV: As European governments are rushing to cut budget deficits as you see from all these strikes across Europe, could this mean a shutdown in Europe's tentative economic recovery -- if there was one I should say and could there be a risk of a slide into a double-dip recession?

Shakespeare: Yes, we are going to slide into a double dip recession. The real problem is that neither the government nor the unions really understand what is wrong. Their minds are locked in out of date thinking. They do not understand; but the core of the trouble is the corrupt financial elite, whose prescriptions and whose analysis actually controls all government policy and by reaction actually controls the behavior of the unions.

Now, the core of the problem is the notion that banks may always create any amount of money for any purpose and always add interest. If I could just take one little illustration in the troubles in the UK at this moment, where the strikes are involved, the UK wants to have some more high speed rail tracks. And it would only be able to do that in the existing system by increasing its debt, particularly interest, and doubling or trebling their cost.

Now what you have got to do is to stop the banks from creating the money out of nothing, let them lend their own money and deposits with permission. But then for any big capital expenditure items which sum up the national debt, the money must be created by the national bank, interest free and then repaid in the normal way and cancelled.

Now that is new, up to date, modern thinking but the government has no idea about that and nor do the unions. So, basically they are going to crack at each other over the next few years and between them they are going to make the situation worse.

Press TV: Max Keiser, it just seemed like a month or two months ago, very recently, that we read the announcement of their 1 trillion dollar rescue package for Europe that was supposed to help the European Central Bank, in terms of its intervention in governmental corporate bond markets. What happened to that?

Keiser: Well, it has become a farce really because just this past week the Irish government was on the phone to institutional investors and hedge funds was trying to sell them some new Irish government bonds. And the hedge funds were openly mocking the Irish government. They were making monkey sounds, they were saying 'dive dive dive,' they were making fun of the Irish government and of course this is on top of last week's news where the Prime Minster was on TV trying to describe the financial crisis and he was obviously drunk. So, it is a complete shamble in Ireland and they are trying to sell bonds; the only place they get to buy their bonds is from the European Central Bank.

So the European Central Bank is now loaded to the gills with all this bad real estate debt, just like the Federal Reserve and the Bank of England. They are loaded to the gills with bad real estate debt and of course this is collapsing all over the world. And the people are right to revolt. I say revolt now or be debt slaves for the rest of your lives. Revolt now; this is the best time for it.

Press TV: Rollin Amore, any comments?

Amore: Well, yes. I think what you have going on here --and certainly I am no fan of the bankers getting a free ride and hopefully it does not continue or at least it is mitigate-- but what you have going on , you have got forty years of big government build up. We have an idiom here, and it is, 'The chickens have come home to roost.'

It is an entitlement problem, not only in Europe but in the US. The future benefits are the entitlements, the retirement systems, the healthcare systems. They have a funny feature about them, when you implement them, they are not expensive but throughout the years they become exponentially, growingly expensive and that is what has occurred here right now.

You have austerity because governments have one of few choices. They can either cut down the entitlements or they can default under debt. And by default, I mean, not necessarily not make payments but printing more money and you get a massive inflation -- kind of like Germany did after World War I. So, there really is no choice, the big government has caused all these future debts that are now starting to come due...

Keiser: That is false.

Press TV: Can we let Max Keiser come in here, because he had something to say regarding one of your statements. Max Keiser go ahead.

Keiser: Well it is completely false what was just said about the entitlement programs -- they are not entitled. American workers for example pay into these games; they should get their money back. What is really atrocious is the banks that have stolen the money. That is the problem, the banks have stolen the money and in case of Goldman Sachs, that have just announced that they are giving their partners a supplementary bonus, right now for all the great work that they are doing and they are implicating and openly committing fraud in Ireland, openly committing fraud across the euro zone.

You know, America just put out a terror alert, today there is going to be terrorism in Europe; yes there is terrorism in Europe. Goldman Sachs and JP Morgan are committing terrorist acts every single day, how come that nobody is in jail? Are they just completely without law? There are no policemen? There are no judges? They have committed massive financial terrorist acts, how come none of them are in jail?

Press TV: Alright, Rodney Shakespeare, going along the lines of Max Keiser there, another thing has been the lack of transparency in which the banks and the various governments who serve them basically have not had a thorough counting of the debts that are held on the balance sheets. Do you agree with that?

Shakespeare: They are not declaring perhaps even a fifth of their debts. And all the time, after their counting periods, they shift them up to the banns and back again. They are up to every trick. There is much more debt to be rebuilt. The system has gotten profoundly corrupted, it is not just the derivatives, it is just normal lending policy which is allowed to go in any direction for any reason and not for the development and spreading of the real economy to everybody.

The physical capacity of the economy is still there. In America you have got a very talented work force, you have got hardworking people, and yet they are being told that they have to have cutbacks, that they have to suffer in the same way as we are and why? Simply to bail out these relatively narrow corrupt group -- the financial elite, because the financial elite and its thinking and prescriptions now dominate the government. The government is not prepared to challenge it, they are not allowed to challenge and all the unions fight the government.

You have to come up with new thinking and accept that the present system is corrupt and is failing and you have to start right at the core of the problem which is the nature and the policies right at the heart of the financial system.

Press TV: And as we try to figure this out, Rollin Amore, over all the effects on the US on a weaker Europe: Will it mean the United States will be able to export less and the likelihood of an export-led US recovery becomes less? It is kind of like America is causing the global recession but Europe is now responding in kind?

Amore: Well, I think what you are going to have is both Europe and US, their economic fates are intertwined at this moment so if you have a failing so to speak, you are going to get it in the US. The two are intertwined in terms of parallel policies and so forth. But, moving back a second. This has been building up for forty years and the nonsense that it is only the banks and so forth is really not sustainable.

Just go back 2 years before the financial crisis. You did a simple math, you look at all the budgets, you look at the future liabilities and it is right there. Look at Greece, they had their problems. They didn't have an overpaid banker problem, they had a payment problem, they had a entitlement problem.

So, I think trying to blame this all on the bankers maybe a very popular stand...but it is clearly untrue.

Keiser: I have got to come in on this because, the guest is making a completely false statement. The government of Greece has come out publically and said we need to investigate Goldman Sachs for the fraud that they committed on our balance sheet eight years ago and two years ago. This is not open to debate. They committed massive fraud, they have been peddling hundreds of billions of dollars worth of bonds that have no collateral whatsoever. They have been counterfeiting bonds. The US government has been counterfeiting bonds. The question is should the people be revolting? And the answer is of course yes. The people should be revolting because these austerity measures are not for them to suffer. The banks need to be shut down and the guys who run the banks need to go to jail. That is not a populous rhetoric; it is a statement of fact. If people want to preserve their livelihood and their sovereignty, they need to act. They need to get onto the streets right now and act.

Amore: Max there is a big difference between allegation and fact. OK? We will see how that plays out.

Keiser: It is a fact, just because we are at Press TV does not mean that the people watching somehow are not aware of what is not happening in the world. You are being very, I would say, pedantic to the folks there...they know exactly what is going on. You are misstating and you are putting a lie out there. It is atrocious. The people should know what is really going on...

Shakespeare: ...On Greece Goldman Sachs was in there in the year 2000 and all they did was they essentially encouraged the Greek government to take on more debt, and to hide it. So it has now come home to roost eight or nine years later. It is the practices of the Wall Street and London banks which is really right at the heart of this matter.

And Max is right, there has to be a straight challenge right at them in a fundamental way, they are going to have to be shut down and something else new, started.

Amore: Look, if the governments do not spend that much money, they do not have these problems, it is a spending problem. Stop trying to cast it off where it doesn't belong. You know, making Wall Street the bad guy may sound good and it may play good in wherever you are Max and so forth but the reality is that the governments have brought themselves in to this financial mess all by themselves.

Just go back a little, to the last 20 years and start looking at the entitlement unfunded liabilities over the next 20 years and you will see you arrive at this point naturally. It has nothing to do with Goldman Sachs. It has to do with irresponsible governments.

Keiser:What motivates you to be an apologist for financial terrorist? I mean you are one of those guys I suppose who would have volunteered to be a guard at concentration camp. I mean you have no morals and no ethics and you are sitting their shilling for people who are putting others out of work and into the mud and dying. That is what you are promoting. You should be ashamed of yourself.

Shakespeare: Rollin is ignoring the fact that it is not just the government debt which is roughly hundred percent of GDP in country after country. It's private debt, its corporation debt. As long as you go more and more into debt and pay interest...the thing gets deeper and deeper.

The debt is now utterly un-repayable and it is not just the government, it is in all countries, and in all aspects of the economy, unless you face up to that, then you are going to solve nothing and that is the situation we are in at the moment.

Press TV: OK, let's take Britain for an example, some saying that British banks may need state bail out next year...meanwhile the UK banks have a January 2012 deadline to repay the 185 billion pounds that they borrowed from the Bank of England.

Shakespeare: Look at Ireland, it is bailing out the Anglo-Irish bank with a sum which is 30 billion pounds. Exactly equivalent to the whole annual tax take of the Irish economy. We are bailing out the banks and the bankers. It is not their bonuses. It is much bigger than that -- we are bailing out a corrupt system.

Amore: I do not think we should be bailing out the bank. I mean do not get me wrong. First of all, let us go back to the statement you made Rodney. It is not the private sector that has a debt problem. If you look at the debt rations of the private sector in the Western world, they are much cleaner than they were years ago. They solved this problem twenty years ago in the private sectors -- starting in the late eighties and early nineties. What did the private industry in the US and certainly some in Western Europe do? They started cleaning up their balance sheets. They started going from unfunded, open-ended entitlement liabilities, to ones that were close-ended. Private sector took care of their end of it. This is purely government debt problem.

Keiser: Just because a bunch of banks and corporations that work with banks like General Motors ...successfully transferred all of their liabilities onto the governments books doesn't mean that they are smart business men. It means they are engaged in accounting fraud...

Amore:Max, you point to GM which is a classic example of opened-ended entitlements because basically GM was run by the unions which is an extension of the US government. I am talking about the real private sector.

Keiser: You cannot have capitalism without capital. You can't have capital without savings. You can't have savings without jobs. There are no jobs in the US because of the whole financial nonsense on Wall Street. You have got to actually give people jobs in America if you want savings and capitalism; instead of...a command and control Federal Reserve dominated system. It is not a free market, it is not competition. There is very little competition in the US system at all. It is all government subsidies...

Amore: General Motors...do not belong on the government doll. I agree with that 100 percent. But the government in the US sees...General Motors basically as an extension of government spending, entitlements, votes. That is exactly the system that is wrong. I agree with you on GM...

Press TV: Rollin Amore, Rodney Shakespeare has a question for you.

Shakespeare: Rollin, the American government has exported 6 or 7 million jobs and with knock-on effects of 10 or 12 million. Now, that goes to the heart of the problem in the US. Those skills have gone and those jobs have probably gone forever.

Now, that is part of a corrupt system which only looked at the interests of a tiny group and said we can export the jobs as long as the company makes a profit. We do not care about the spending part which should come from jobs to Americans. Now that is an example of the corruption of the present system. You have got no answer to that, you have got no mechanism...and you can only do that from interest free loans from the national bank and that is what you haven't got in the USA.

Press TV: Rollin Amore, go ahead, you have an answer you said?

Amore: I do have an answer Rodney. The US government is not exporting jobs directly. Indirectly yes. And you know what the problem is? They have hostile tax regulatory policies in the United States. It is very simple, when you have the highest corporate tax rates in the world. The answer, the outcome to that is that jobs are going to get exported to the lower tax sovereignties and so forth.

Keiser: ...Less than 5 percent actually paid taxes last year. Goldman Sachs tax rate last year was less than 1 percent. These companies do not pay taxes.

Amore:We had a world economic recession last year, nobody made money. You do not pay taxes when you do not make money.

Keiser: And pay themselves 140 million in bonuses? Where did that money come from? It comes directly from the government. It comes from the people who are revolting and they are looking for guys like you, who are shilling for the financial terrorists because you keep misstating the facts and covering for theft...

Press TV: That is one thing we touched on -- transparency. I mean let's face it, why do we keep hearing about the bailouts, why do we keep hearing about other debts that have accumulated. And tell us about the sensitivity of the people that have come out in arguments and in their protests, which have gone severe. I mean some are saying they should at least have a democratic sensitivity, that people want more job created and not impose more sanctions from the higher ups.

Shakespeare: Well, there are several problems in there. There is a technological shift going on and a lot of high-paying jobs are actually being smashed out by a move towards technology, and the unions naturally try and preserve their jobs there and their income and they are probably going to have to take up new policies including a shift more to a more widespread capital ownership. You cannot blame the unions. I mean when a person gets unemployed, they lose their status, their psychological perception of themselves goes down and of course in a very real sense they lose their income.

They may ineffectively lose the whole pattern of their lives. It is a very serious matter. And what we have got in this country is that we have got the Prime Minister saying, oh well these cuts are 25 percent on public spending on average will be the cuts. This won't really affect the situation, because he believes that the whole thing will come back into balance. It is patently clear that we are getting ups and downs as part of a long process and it is a downwards depression, it is going on for 15, 20 years or more.

The government doesn't understand it. They are very likely to talk about loss of jobs and unemployment as though it is something which is going to come back. They do not realize what they are doing to people's lives and those people are not going to get redressed. They are probably going to have their lives smashed. Take Spain, 40 percent of the young people between the age of 18 and 25 are unemployed. That particular generation will probably never get jobs, you see that have missed the chance.

Press TV: I want to ask a question, 30 seconds each guest. Where is the future headed for Europe?

Keiser: The people who are tired of the ECB and the Federal Reserve Bank are aggressively buying gold and gold is going to double and triple from here and it is going to put all of these bankers completely out of business, thank God.

Amore: Well, you know if Europe does implement its austerity program, I see Europe in an economic rebound over the next five to ten years.

Shakespeare: A long depression is going on. They do not know what to do. They do not understand it.

RBK/MB/PKH

[Pharaoh]

1. Kickin for later....

[civilisation]

2. This part is brilliantly stated;

"The government of Greece has come out publicly and said we need to investigate Goldman Sachs for the fraud that they committed on our balance sheet eight years ago and two years ago. This is not open to debate. They committed massive fraud, they have been peddling hundreds of billions of dollars worth of bonds that have no collateral whatsoever. They have been counterfeiting bonds. The US government has been counterfeiting bonds. The question is should the people be revolting? And the answer is of course yes. The people should be revolting because these austerity measures are not for them to suffer. The banks need to be shut down and the guys who run the banks need to go to jail. That is not a populous rhetoric; it is a statement of fact. If people want to preserve their livelihood and their sovereignty, they need to act. They need to get onto the streets right now and act."

Max You did a great job of bashing that bankster shill! Most people just do not want to face reality., and when some guy comes on like Amore and tells them some crap about a "slow rebound over the next 5-10 years" they would rather accept that, than the realization that the problems are systemic and a fundamental change is needed. People are very scared of big changes,. as they don't like the unknown, and the possibility of things getting even worse for them. My question to these people is would you rather have a slow death, or a possibility to build something better? Something that does not have the built in concentration of wealth for an evil elite few on the backs of everyone else. As that is the established system as we have known it for many years.

[janewin]

4. If Charlie Monger

Says I shouldnt buy gold, then thats exactly what people should do. This is the same guy who think we should all shut up while they cut our SS payments

[janewin]

3. love it

This guy should get a mainstream tv show. Hes the radical version of Ratigan

[janewin]

5. .

k & r