Tag Archives: interview

Dawn J. Bennett Interviews Chris Whalen, Investment Banker and Author

Dawn J. Bennett, a certified management investment analyst and founder and CEO of Bennett Group Financial Services, recently interviewed Chris Whalen on her radio show Financial Myth Busting with Dawn J. Bennett. Chris Whalen is a senior managing director and head of research at Kroll Bond Rating Agency and has previously worked for several prominent financial firms, including Bear Stearns, Prudential Security and Tangent Capital Partners. Whalen is also the author of Inflated: How Money and Debt Built the American Dream (2011) and Financial Stability: Confidence and the Wealth of Nations (2014).

On Financial Myth Busting, Bennett and Whalen discuss what Donald Trump’s surprising victory means for the markets through the end of the year and how his views on monetary policy will affect the larger global economy.

With Trump set to take over the White House, all eyes are on the Federal Reserve, which avoided raising rates before the election. Bennett says she thinks the expectation is that Yellen now has no reason not to raise rates, and asks Whalen whether he thinks Yellen is likely to raise rates.

“Well, I think first and foremost you’ve got to look at the bond market,” Whalen said. “What the bond market tells you that since June when yield for the 10-year really reached their lows, yields have almost doubled. So the 10-year is headed to about 2.2 percent. I think it’s going to go higher. And that has to catch up with the market, Dawn, it’s what it comes down to. Mortgage rates are going up and bondage and linkage are coming back.”

He continued, “We had almost 10 years of kind of managed stability care of the central banks and now I think that people are looking at Trump’s spending program, cutting taxes, various other things and also I think the fact that politically the Fed cannot continue to monetize debt the way it was during quantitative easing when they were buying bonds and they basically got to hold them to maturity. I think that all of that is now putting the market back into the hands of investors who have been on the sidelines in terms of the direction of interest rates for years. I think you’re right. They are going to have to raise rates just to catch up with where the market is.”

Bennett says she thinks the country is in a jam, as Trump will have to contend with Obama’s massive debt burden that has built up over his eight-year term. Trump has to do this at a time when we are at this epic point of accommodative monetary policy. She asks Whalen what he thinks will happen when rates go up.

“Well, you know, the equity markets for the past few years have been substituting debt for equity and I think you’re going to see a lot of big corporate issuers slowly let that debt run off and they’re going to have to issue more stock,” Whalen said. “Now, the markets are hungry for stock. You haven’t had much in the way of quality issuance going back to the crisis. However, it’s going to put pressure on stock prices simply because IBM and many, many other big industrial companies—even companies like Apple, for example—were out buying back shares and issuing debt. That’s going to reverse itself. And I don’t see that as a catastrophe.”

He continued, “I think you’ve got to just be cognizant of the fact that bond yields are going to go up. The pricing on your portfolio may suffer as a result but hopefully you can sit with it, and at the same time I think you’re going to see a lot of companies desperately trying to rebalance their balance sheets in terms of the debt/equity mix. It got very lopsided over the last few years.”

View the full interview here, and catch Financial Myth Busting every Sunday at 10:00 a.m. on WMAL AM 630.

Apple Hit with $14.5 Billion EU Tax Penalty

Back in August, the European Commission ruled Apple owed $14.5 billion in unpaid taxes to Ireland, the largest tax penalty for a U.S. tech company. According to the Competition Commissioner Margrethe Vestager, who has made tax avoidance a chief focus, Apple made illegal deals with the Irish government that enabled the company to pay virtually nothing on its operations in Europe. Apple’s arrangements with Ireland allowed the tech giant to sidestep taxes by fueling most of its non-US sales and profits through an artificial head office with no employees, no premises, and no real activities.

In doing so, Apply paid just 50 euros per million euros in profit in 2014. The European Commission ruled that Ireland collect 10 years’ worth of back taxes from Apple, equating to 13 billion euros or $14.5 billion, plus interest.

John Browne, a notable tax consultant and former member of British Parliament, discussed the implications of this ruling during his interview with Dawn J. Bennett on Financial Myth Busting with Dawn J. Bennett.

According to John Browne, “The ruling is threatening first of all the reputation of Ireland as a low tax nation. Secondly, the ability of these companies that have come there for the low tax to generate very high paying jobs, most of them in high-tech industry, and therefore contributing very much to Ireland’s economic growth and prosperity. And thirdly, challenging the freedom of a nation to set its own tax rates.”

He continued, “We’ve all got to wait for this Court’s decision to even have a view on that, but if the Court decides in favor of the unelected European Commission, I think it will be awfully tempting for Ireland to join Great Britain in exiting the European Union and coming back much closer to Britain, outside the EU.”

Browne explained that if the Court finds in favor of the Commission, then companies like Google, Amazon, Starbucks or Microsoft will all be on the line.

“A lot of these companies that have gone to Ireland to benefit from not only the low tax rates of Ireland, but three other things that Ireland offers that the rest of Europe is not so easy to offer,” Browne said.  “One is they speak English; the second is they use English law, which is the same as American law because it was developed from English law, rather than the Napoleonic Code; and thirdly, they have close relationships with the United States and all the former UK Commonwealth and colonial countries like Canada, Australia, South Africa, and most importantly perhaps, India, which is a rising economic superpower.”

To view John Browne’s complete interview with Dawn J. Bennett, click here.

Is Another Global Depression on the Horizon?

Dawn J. Bennett, founder and CEO of Bennett Group Financial Services, recently interviewed Richard Duncan, an author and financial analyst, on her talk show Financial Myth Busting with Dawn J. Bennett. Duncan specializes in fiat currencies and macro policy and has written many books, including The Breakdown of the Paper Money Economy, The Corruption of Capitalism, and the Dollar Crisis: Causes, Consequences, Cures.

In his video newsletter “Macro Watch”, Duncan recently reported that the global economy is in $300 trillion in debt, after the global economy moved to a debt fueled-growth strategy over the last three decades. Duncan explains this statement further during his interview with Dawn J. Bennett.

According to Duncan, the economic system has changed in fundamental ways from 1968 and 1971, when dollars stopped being back by gold. The economic system changed from capitalism to what he calls “creditism”. How this economic system operated is businessmen would invest; some would make a profit, save the profit and accumulate capital, and repeat the process. The system was driven by investment and saving. Today, the system works in an entirely different, explained Duncan.

“Our system is driven by credit creation, and consumption, and more credit creation, and more consumption,” he said. “That has generated fabulous economic growth, at least up until 2008. It ushered in the age of globalization, and it created the prosperity that we’ve enjoyed all of our lives, really up until 2008. The problem with that is that in 2008 we reached the point where the private sector, the average Americans, just couldn’t continue taking on any more debt. At that point they started defaulting, and this global credit bubble that resulted from creditism started to implode.”

Duncan is predicting this will lead to economic collapse. According to Duncan, the U.S. government has been managing the U.S. economy at least since World War II, so for about 76 years now, and have not been doing a very good job.

“We’ve reached the point now where this creditism can’t continue to create economic growth because the private sector is too heavily in debt,” he said. “If the government sector doesn’t continue borrowing and spending to drive the economy then there is a very real danger that we will collapse into a catastrophic global great depression again.”

For Dawn Bennett’s complete interview with Richard Duncan, click here.

Dawn J. Bennett’s Exclusive Interview with Niger Innis, Political Consultant & Commentator

Dawn J. Bennett, Host of Financial Myth Busting with Dawn J. Bennett, recently interviewed Niger Innis, an MSNBC commentator and political consultant. Innis is the national spokesperson for the Congress of Racial Equality (CORE), an organization committed to confronting and banishing apartheid in America, as well as fighting for Americans of all races. He also leads Tea Party Forward, one of the largest national Tea Party groups in the country. In his interview with Dawn J. Bennett, Innis discusses the upcoming presidential election and Black Lives Matter.

The Presidential Race

Innis says it’s a “very real possibility” that Donald Trump could be the next president. “We’re [Tea Party Forward] not quite sure just yet about Donald Trump, we’re all supporting him now, now that Ted Cruz has dropped out, and we certainly prefer Donald Trump over Hillary Clinton, but we’re certainly not sure if Donald Trump is going to be a Constitutional Conservative or could he very well be a big government Conservative.”

He continued, “So that even if he makes the choices that we would like, how he executes those choices, through executive orders or through running roughshod over Congress and not recognizing the separation of powers, is something that would concern us, that wouldn’t concern us as much with a Constitutional Conservative like Ted Cruz. On the flipside though, what thrills the Tea Party about Donald Trump is his ability to confound the media, his ability to not only circumvent the media, the establishment media, but to actually shape and confront the media and get them to talk, to say his talking points as opposed to him playing from their song sheet.”

Innis believes Trump can appeal to the black community.

“I think his talk of building a wall, the economic American nationalism that he promotes, it’s something that would appeal greatly to a number of black Americans,” he says. “Particularly, we hear in this election and we see it and we often say that it’s a reflection of angry white males—Trump’s popularity. But the little hidden story is that is not talked about as much is that there are a lot of black males and Latino males that are angry too, that are unemployed or underemployed and want an opportunity to earn a living and be breadwinners for their family.”

Black Lives Matter

On the subject of Black Lives Matter, Innis believes their protests are not helping racial minorities, primarily because they’re “hardly reflective of the black agenda”.

He notes, “There was a poll taken by Gallup during the height of the Black Lives Matter movement and spotlight on them in the August of 2015, this was post-Ferguson. And in that poll, it asked the question to all Americans, but in particular the blacks, it asked: do you think that there are too many police in the community, not enough police in the community, or just enough. When you combine those that believe that there were just enough, just the right amount of police in the community, or not enough in the community, that number was 89%.”

He continued, “Those that thought that there were too many police in the community, that you would think would be reflective of the Black Lives Matter ideology, was 10 percent. So, it was nine to one in the black community of those who felt that we want as many cops that we have in the community right now, or we want more cops in the community.”

To view Dawn J. Bennett’s complete interview with Niger Innis, click here.