Is a headline from daily reckoning and by the way you know you and i first when we first met back in two thousand and three your daily reckoning was one of the only sort of online sites available at that time one of the go to sites this is way before facebook and twitter and all that sort of stuff we went to the daily reckoning all the time they talked about slam the price lower once shorting big became an option they said but so far its still bonkers obviously six percent in the financial world is big coin backed by comes up whats it backed by you know much coming into it you know its sucking in all the dollars yen drachmas un euros its all being ruined too its not going to lead point encrypt out if youre swapping garbage money for good money so youre not going to go back to garbage money so its backed by all that money is back billion dollars going to be worth more than seven trillion dollars big coin is thought to be worth a trillion dollars so all of the out money in the world all the fractional reserve banking over leveraged garbage weve been warning about in the two thousand and three we said yeah gold is a place to hide from the. Apocalypse but then because it came around and starting in two thousand and eleven we said you know this is actually the way its going to happen this is the financial black hole thats going to suck in all the all the money and its happening you know quite rapidly and so hes right to say that the gold is the first of the major commodity slouched currencies to be disrupted by bitcoin but after gold will see other major fianna currencies collapse implode well you remember Alan Greenspan who was a gold bug and then became the head of the central bank of america well he had said that. The u. K. Was stupid to give up their gold because extraordinary an. Gold is always used just like what happened to germany during World War Two but this is something were seeing that too the u. S. Controlled Financial System so look at whats going on with that case of turkey versus around and they were using gold because iran was dollars but now ive seen more and more weve seen venezuela announced the petro partly if not mostly to circumvent sanctions. I saw an advisor to Vladimir Putin being quoted recently that he thought bitcoin could be a good way to circumvent sanctions as well so they originally design for bitcoin was also in order to circumvent the Financial System where so much fraud and opaque happens behind an opaque wall of drea all sorts of derivatives and fraud and then they get bailed out by the Central Banks remember that there was actually mention the Bank Bailouts in the u. K. In the run on Northern Rock so here this gold guy from daily reckoning and thats how you and i met over gold talking about gold and daily reckoning he says big queen trading is totally bonkers and it doesnt look like its going to come down any time soon it is morphed from an underground tech geek trade to the biggest market menial weve seen in decades big news is pushing stock market stories below the fold despite the markets incredible bull performance this year equities are starting to take a backseat to cryptocurrency and then theres gold big to ceilings golds thunder as the Holiday Season approaches doomsday preppers used to stock up on gold and canned goods now theyve cleaned all the gold out of their bug out bags and replaced it with bitcoin so then it goes ill just mention the all these debates that is a store of value or Payment System doesnt matter people are piling in theyre getting rid of their gold and theyre going long on big going to. No thats right i mean its turned out to be a fantastic store of value and its attracting trillions of dollars and the price will explode upwards to a hundred thousand and beyond and then itll start to level off theres a fantastic chart of somebody posted online about the gold versus the reich mark i guess was the german currency during hyperinflation wymore republic days and gold one to trillions of dollars an ounce versus the right market. Right mark around and the same thing is happening of bitcoin versus the u. S. Dollar where you could see big coin trade a Million Dollars a coin you know its not necessarily the price of bitcoin is moving so much as the the u. S. Dollar is experiencing a hyper inflationary collapse public moment for planet earth well hyperinflation is a kind of a political thing you know they always say events hyperinflation as a political event people lose faith in that system so who say like when you see the fourth thing you can do you cant beat them over the head enough you cannot the gulag archipelago show that you cant believe in your your cult you know within a few years you know fifty sixty percent of the population will have a Million Dollars worth of crypto on on a private key on a you know a tres or a some other off line you know storage device and how you going to convince those people to comply. Its not whether or not you can get them to comply with the law yeah well pay their taxes yeah they buy their obamacare yeah will do that but can you get them to believe in janet yellen in the next fed chairman in the e. C. B. Can you ever get them to believe that that system is sound again can you get them to say ok thats going to be great doesnt matter you can arrest them you could put them in jail you can find then you can do all that stuff whether or not theyll ever believe you whether now theyll be like hey happy with the system going to go out and shop and go no think about the future and its all great now theyre not going to do that. So here weve established that because some time in my block all its affected your cognitive abilities dont make the camera people laugh ok so very frank i can only so we said its a story about you its also the value of bitcoin is the actual network in the ecosystem in the open public ledger its also attracted just like early Silicon Valley which didnt attract the best smartest most innovative people but the thinkers the sort of people who think about putting does not know what the answer is no theyre not going to go back and im going back to janet yellen theyre going to back the Central Banks they will they wont go back they had the confidence in the system is collapsing and there is no turning back this is the collapse of the nation state and the central bank and the fractional reserve money system big coing is to banks what the Printing Press was to the Catholic Church it collapsed it in many ways this is the end of this era this is the new beginning this is about everyone having autonomy and sovereignty with their own money that cant be confiscated then never it is deflationary wral uganda and like i said the value of the network is also the fact that the smartest minds in the world are attracted to it and theyre all working on it and theyre coming up with solutions so no matter how many how much fund you throw out it you can say all the things wrong with that as soon as you identify the things wrong with it or the flaws thats the thing of an open Source Network is people like oh the Evening Standard in the u. K. Ran a front page story recently that said that the government needs to warn people that if they lose their crypto currency there are no bailouts for them exactly exactly we dont want bailouts. Go dig a hole in the ground throw yourself in blow your brains out and cover up the hole thats what we think of you even standard George Osborne the british establishment lawyer with r. B. S. It just b. C. And barclays theyre all frickin terrorists and should die for ok we got to go to break states unless you are coming your way. About your sudden passing ive only just learnt you worry yourself and taken your last wrong turn. To you as we all knew it would i tell you im sorry i could so i write these last words in hopes to put to rest these things that i never got off my chest. I remember when we first met my life turned on each spring. But then my feeling started to change you talked about more like it was again still some more fun to feel those that didnt like to question our arc and i secretly promised to never be like it said one does not leave a funeral in the same as one enters the mind its consumed with this one to. Speak to now because there are no other takers. Claimed that Mainstream Media has met its maker. With more make this manufacture consent to public wealth. When the ruling classes to protect themselves. With the flame and merry go round to be the one percent told. To ignore middle of the room sit. I mean really knew. What politicians to do something to. Put themselves on the line they did accept the reject. So when you want to be president. Or some want to. Have to be right to be for us thats what before three of them or cant be good. Interested always in the waters in the. City. How does it feel to be a sheriff the greatest job in the world its as close to being a king of any job there is one Business Model helps to run a prison now we just do it on my guess is nobody over the case and i dont no one comes in any more we dont have to sarge them anymore is Cost Effective thats what they want to do that long they dont give a damn if you did so as a matter theyre vastly paying us to put it back into the louisiana incarceration rate is twice as high as the u. S. N. Breach what secrets is behind such success. Welcome back to the kaiser report imax guys are time now to turn to jim rickards prolific author and hes also the chief global strategist at merrill. Jim welcome back thank you max all right mary glom what is. The company i started with some partners a year ago we specialize in Predictive Analytics and Capital Markets its actually the continuation of project prophecy which i worked on at the cia pfizer privacy if you were down here in studio very close to the world the former site of the twin towers there was Insider Trading in advance of the nine eleven attack after the attack the cia said well it was going to be another spectacular attack would have been started trading again could you identify it because you trace it to the source code if i swore to break down the door and stop the attack that was part of prophecy i was one of the code managers on that and basically we developed to predict about political system inside the cia that worked extremely well all thats happened now is taking that technology was some partners with some investors were not doing private version of that to do Predictive Analytics to Capital Markets however we go well beyond what we did at the cia as you know technology is advanced science has advanced so weve really got third wave Artificial Intelligence and some other inputs to that to come up with a very robust system ok now remember poindexter was saying John Poindexter will jump points that oh gosh yeah he came after nine eleven like i think it was he came up with. Mark it was a call well there was to be a total information awareness the right project but they wanted a they wanted a futures market basically a geo political futures market so you could bet on whether the time Yasser Arafat was going to be assassinated are what the whole thing was modeled on my Hollywood Stock Exchange you know that i saw my second i did not know is based on that technology i do know that this is sort of the call the wisdom of crowds if you get enough people making enough that its. And i was the reverse of marla better production than you know an analyst sitting in a cube about how now that the time when they launched it. There was a lot of pushback because they said hey you know theres a conflict there because terrorists can bet on the terror act and then they go out and commit the act and they cash in well that was one of the objections but specifically one of the contracts was with Yasser Arafat be assassinated the pushback came from then senator Hillary Clinton who the new york senator at the time who course was a good friend of arafat so there were there was that was shut down but we were we were hearing that was actually darpa the defense. Project research arm but we were doing it inside the cia as we did we sort of dodge this bill is a process that really you know Prediction Markets such as the years i think Predictive Analytics where youre looking at the data and you are using algorithms and you are sorting through the data to try to pick up on patterns and and this is all internal its not out there people are not buying and selling protection contracts us were not running production market run appear to violence but the science is when we do on the theres a lot theres less there than we see out there was no crowds wisdom of crowds really good if you want to guess the number of jelly beans in a jar the average of a thousand people would know mathematical understand well actually be pretty good guess the weight of the car like an old english fare that stuff works good but the more complex the problem the less the wisdom of crowds works and for example even in markets where you have a lot of to spatial so lets go back to february twenty seventh two thousand and seventeen earlier this year the market was giving a thirty percent chance of a fed rate rate hike in march the fed actually did hike rates in marseille it got two hundred percent the day before the meeting but theres an example of the market was way off and thats ok theres many markets are invaluable but theres a lot more to we use. Base that we use their complexity theory behavioral psychology history and other branches of science to come up with our forecasts ok so you say this is now across your work i believe it was in death of the dollar or the chapter one the death of money chad was money on. Ok not the nine eleven you are observing as well as your colleagues in the Intelligence Community activity in the Financial Markets that telegraphed that something was coming we were not observing it in real time it was there that the information was there and i did run into people later who saw that the cia was not observing that at the time but after the fact you can look back it was very obvious the the it was done through a by a put option usually Insider Trading is done in the Options Market because theres a lot more leverage with the first place the i. C. C. Looks by the way so that on two trading days before nine eleven buying puts American Airlines two hundred eighty six times the average believe im so sick i order a big mac every day and then when there were two hundred eighty six big macs you know somethings up i talked to John Martorano just after the after the fact if you looked at the data and he said oh my gosh some some of this knowledge was circulating ahead of the of a not just me and not just the agency but there were academics i talked to john moe who was the special jumbo hearns. New york Stock Exchange specialist for made markets and american you know he was the market maker in those two studies that like i said ive never seen more blatant Insider Trading when a Space Shuttle or a special challenger blew up more if i call the contractor for the booster rocket puts in this case sky rocket it sure does the thing just blew up here you are observing the event as if something a blown up before it blew up in the post event youre looking back i seen that man and so now. Markets are very sensitive to this data and how much of the Predictive Analytics that you are incorporating in this service is taken from market data well we start with market data and thats the many many example by the way you have to separate sort of Predictive Analytics on the one hand and like Law Enforcement looking for insight of traders and all that but this is sort of trading all the time in the head of you know i mean a announcements thats quite common you can always see that you can see it before the fact definitely see the. The fact but were seeing that we see market data but were also using complexity theory which says that in any system the scale of the system scaling metrics are very important in the density function the interconnectedness thats a leading indicator of potential collapse or you know they are ok so whats the ratio between market data and non market data roughly well its hard to say it depends it depends on the particular no see we take all this so we use behavioral psychology thats just thats very well established with all the interest its biases you know people would rather take three you know three dollars as a sure thing instead of three dollars twenty cents expected value if theres a twenty percent chance of loss and your risk aversion anchoring always be a robust has been very well known you can incorporate that we use history a lot of the what wall street does these correlations are regressions there are a lot of limitations on that number one youll never see the weird avail never see a recession you never see a socalled black swan you never see a catastrophic event youll never see that the correlations you always predict more the same you get random outcomes which is not true things are pet dependent number one number two the time series are often too short like one hundred five hundred or even use fifteen hundred year time series go back to the collapse