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tv   Stossel  FOX Business  January 9, 2015 12:00am-1:01am EST

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news man and a financial superhero. go to and let me know what you think and whether i'm doing a super job for you or not. again, it is up to you. ♪ ♪ john: don't you need to mop the floor? elta cao buy groceries? so you can rest assured that they are reliable and trustworthy -- what? why would i believe them? political individuals want us to trust government. but didn't margaret thatcher pop that bubble years ago? >> and this actor says privatize everything. privatize the fire department and the police department. >> but that upsets the left.
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but the private sector does things better. that is our show coming up tonight. ♪ ♪ no. >> now it is time for john stossel. john: trusts. a lot depends on it and families often succeed because we trust families more than strangers. government works and people trust the government rules are fair. commerce works when customers trust that it will work. these are delicate relationships developed sometimes over a million years, but sometimes the internet is changing things for the better. i would argue that here is one example. >> do you need to mop the floor, by the groceries and milk the cow? task rabbit helps you get stuff done, first you post your task and then include all of the
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relevant details like location and price and other important information. it will blast out an sos to those in your neighborhood letting you know that your task is underway. and you are done. >> really? a stranger coming into your house mopping the floor and buying groceries? why would i trust the stranger? the owners say that their rabbits are professionals who go through a rigorous application process. >> you can rest assured that they are reliable and trustworthy. john: really? why would i believe that max wyman people trust total strangers herriot the book argues that the internet has given more of us reasons to trust total strangers. julian smith runs a business that is based on trust. before we talk about your business, let's just talk about task rabbit. tasks are personal.
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why would people trust some kid to come in and do that. >> is a really good question. the reality is i think when we see people on the internet now i'm alesia phase and their reputation. john: what you mean by reputation? >> people before you doing tasks, mopping the floor and so we have an impression that is from looking at their reputation. john: this is what we used to learn from family and friends and neighbors. >> we used to live in small villages and we trusted everyone. recently over 50% we are surrounded by strangers and we ended up with the systems in place that progressively get billed and those systems say should i trust this person for this thing because it's impossible for us to be constantly making that decision over and over again.
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john: your business is based on that and you share office space. >> i run a company called reader that provides temporary office space for people at a moments notice. so that means all customers are going to places they've never been. you're walking up and there are strangers. so in our case we ask where the real menace and they point to the back and that is it. we trust each other even though we have never met. john: if you can set it up so people can share offices, why not cars? most of our cars suck up our car payment money. they don't go anywhere. why can't i share my car the way that this lets people share office space? companies like get around allow people to earn money by sharing their car. >> we are enabling people to
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make money off an asset that cost them a lot of money. john: that is just one of the companies doing it. >> there are a a lot of companies doing it and essentially this is even more implement because of some of these car. so first of all you're walking into a stranger's car, it should be clean and nice and a better run while, otherwise you could end up in a bad situation. >> what if i run my car to someone who cracks it up? if the driver kills somebody, you could be held responsible. >> we have $5 million in insurance on every space that we have. and it depends on the company but that kind of stuff matters. because at the end of the day you're trying to build a respectable business and that means treating people well on both sides of the equation. >> protecting people through readings and reputations, this is new.
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otherwise we see government regulation with huber and lift and all of these other companies. so how i know that this guy is save? i don't know that this taxi driver is safe just because he passed a test from a bureaucrat. >> that is a great example. drivers may not be perfect, but they get raided every 20 minutes on uber. john: every time someone takes a car and you get to read it right there. >> people are reading each other the whole way. john: let's expand this discussion to the rest of the world. one reason people stay poor is because it's hard to establish trust. many people say africa or south america or russia are free to build a business because they don't trust that once it's built they will get to keep it. maybe the dictator of the country will just take it from them or maybe a mob of thugs will steal what they make.
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people want to trust that contracts will be enforced and honored and that is why we are lucky to live in america where we have a pretty trustworthy system. but michael strachan has spent the last decade in places that don't have a trustworthy rule of awe. what do you do there? >> i have two projects. one is working to develop legal systems that actually provide the trust where you have and you know that the government will not take your money and the other is helping entrepreneurs and talented individuals develop the skills and get online so they can engage in contracts. it's an online world where they can build the trust right now and then we also want to help them on the ground have a legal system where trust is possible. but you are exactly right. the people in developing countries can be trusted and they could remain poor. john: they can't trust that if
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they expand their house that someone will come in and say that you don't really own that house. so why add the floor or renovate reign. >> most developing governments one way or another offer nd/or rule block. most countries it is a little or a lot risky to invest capital for those reasons. john: you train the workers in the third world and many find the work in faraway places. here is a commercial promoting the idea that people can work without going to any office. >> my commute to work was an hour and a half of my day in my car. >> are used to have to fly a million miles per year. john: it is very exciting that these global online labor markets allow people anywhere bright and talented people anywhere to actually engage in international commerce and in addition we are going to a smart
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contract level where more sophisticated arrangements can be automated using lock and chain technology so that entrepreneurs and investors in the west can hire people in countries without rule of law and use this technology to put funds in escrow and pay them wants the job has been completed and reliable way. john: these people feel more assured that they will be willing to do the work? >> exactly. that sort of technology allows for international trust at a scale where it's never been possible before. john: on the flipside, some work for minimum wage in america to establish trust in hopes that they will get paid more later. >> we are working with people in rural uganda were a college graduate makes a hundred dollars per month. and so if we can help a college graduate aramaic $180 per month
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or $200 per month, doubling your income, we need to ignore developed wages and focusing on doubling or tripling the incomes of developing world people quickly and easily by means of giving them access to the global labor market. john: the internet gives entrepreneurs and ways to raise money. people used asked to go to the local bank and the bank would ask if this person was trustworthy. and maybe you would have enough of a reputation and they would loan you some money. but now a company called funding circle says that you can do better. they're from commercial features small businesses doing well. >> so well that he wants to open a second location. to help make that possible he wants a loan. the problem is that banks are not making loans to small businesses like rubber. they are stuck in her old ways and are bogged down by regulation. john: that is often true. increased regulation before dodd-frank has made it tougher
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for entrepreneurs to get money from banks and banks are not the only option. >> other specialty finance firms are willing to make loans, but it is harsh terms. now small business entrepreneurs have a new option. funding circle. funds come from other successful entrepreneurs and organizations that want to invest in small businesses. john: it sounds like a scam to me. >> most financial regulations prevent startup entrepreneurs from accessing capital and it makes it easier for the big guys to get capitals. the web-based approaches will allow for startups to have more diverse sources of capital at lower rates and as a consequence we will see a lot more small startup entrepreneurs obtain the financing that they need. john: how can the investor trust that the money will not be squandered or stolen? >> there's a company that actually provides three times
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the rates from friends and family. if her friends and family trust you, then they will put three times as much in because they figured that those people havarti video. there's another online source that will provide revenue-based financing. what we fear is that there are lots of people finding diverse ways to identify trustworthy entrepreneurs and putting money into their companies so that they no longer are dependent upon the banks, which are the last place anyone goes to for money anymore. john: you told me about internet celebrities who i have never heard of, they just appeared on facebook and they somehow were so appealing and trustworthy to their fans that companies pay them thousands of dollars for short videos to plug in products and one woman talks about makeup. she has millions of you as. >> a lot of people are happy with that new mechanism. john: the kids that watch or trust or because they like her
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and they will buy the product? >> it's interesting that in the blogging world there is this thing about disclosure and making sure that we know that it really is something that's being paid for or that it was a free something, we don't know what it is. i don't know what the rules are for this particular person, but generally the more transparent they are, the more that person ends up being trusted and the more opiate or secretive it is. the last trust occurs over time. john: to join this discussion join me at stossel were like my facebook page and you can post on my wall. we want to know what you think. coming up next, what if your coffee shop had no one to behind the counter if no one was watching, would they pay? you would be ♪ hello ♪
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i was trying to fix all the things that were going on, especially when it came to ryan's daydreaming and inability to focus on her homework, and tears, a lot of tears. why are you laughing? it's so true. it was just frustrating to get my mom to understand really what i was going through. and that's when i thought there must be something else going on. so that's when we talked to a doctor and she was diagnosed with adhd. it just explained so many things for us
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and it makes things a lot easier. a lot easier. and when you have information, when you know better you do better. you know, and i feel like that really made a difference. yeah, i agree. hyperactivity isn't the only symptom of adhd, since inattentive symptoms like ryan's, can be less noticeable, it's important to learn more. get the adhd symptom checklist at to get started. then talk with your daughter's doctor. keep momming. john: privatize everything privatize the fire department and the police department, privatize everything and make them responsible. >> go get them. i love it when a hollywood or get something right. americans just assume government must be in charge of things like road maintenance and garbage collection and ambulance services.
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murdered bacher raised people's consciousness about that. two the government has a duty to get the best deal. >> margaret thatcher deftly said herpes. we have plenty of politicians in america who want to run everything. more cities have woken up to the benefits of an alternative. private management. this individual of the reason foundation talks about the reason privatization report that tracks what is working and what is not. what is working? >> we have lots of routine services where citizens interact everyday, wastewater, pothole repair, that sort of thing things in the backend of government i.t. payroll where those sorts of functions, we have other things in the private
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sector. john: how does it work to why does the private sector do it better or cheaper? >> they are in a system where they have to compete and that creates compared to a government that tends to be a monopoly with no competition with higher costs the of lower quality. john: everything government buys they pay above market and deliver below market service. >> often there is little incentive to be efficient with there is no attention with competition. john: your report cites pontiac. >> it is the great story was financially distressed and went under emergency manager control and they got to step in and to take over the decision making to the private sector they cut
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their budget in half, cut the city stepping by 90 percent, they cut the debt load by 70 percent. john: day reduce the debt by $87 million even a private ambulance service? >> cities and counties contract the ambulance services. john: who pays? if you die a hands you a bill? >> it is different but taxes cover some of it but whether public or private for people in particular are no less served by the ambulance service. when i run one says you have to pick somebody up they do. john: and you get a bill after words? if you don't pay maybe medicare/medicaid or subsidies. john: they turned over 500 bridges to a private company to rebuild for the next 10 years. >> writes. they gave them the innovative deal to financing
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and we build and maintain 550 bridges they will do a better faster cheaper than the government in its traditional way of procurement and they will save 20%. john: maybe it is better in chicago i hear they privatize the parking meters >> chicago is the first to privatize those parking meters. one of the things they are criticized for they got money up front over 75 years and the politicians spent it so that is more faults of the politicians in the privatization. >> in indianapolis they privatize the parking meters making $518,000 before been almost $3 million after because the government leaders were broken and it took days or weeks to fix
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them. >> they would sit on broken meters for weeks. but the operator has a 99.9% efficiency rate to keep them up and running and they get calls within hours. the utilization is much higher. john: despite the success people hate the idea to turn government services over to for-profit companies. >> if no one to pay for the roads in the rivers separate section of the environment. >> it is stupid. and then to have good value for money. id with airline security they'd use of government for that. >> most of them are small but sampras's co and kansas city have never gone to the tsa screening operation.
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>> we interviewed customers. >> but people here are willing to help. >> dallas has governments greeters and even though they were friendlier and quicker they would find more contraband. >> in year they put them together. the fastest wins to thousand dollars. >> tsa also trades but not like this year they would search banks to identify forbidden items. a pipe bomb and they rush to repackage the bag.
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[laughter] >> the government doesn't do this for private company knows if they have a good reputation they could get richer with more airports with an incentive. >> if they do a bad job there fired. so they have national built-in incentives because they are the monopoly. john: next words you trust a group of strangers to be your doctor? i wouldn't until i researched a new company that are convinced. next.
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stos my john: my knee hurts but i don't know why. i could go to doctors but they are expensive and always make me wait. often they don't know what is wrong. will the internet help? i go to google but this gets me all kinds of contradictory advice not to
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mention a useless and stupid device is there a better way? here is a doctor who concluded there is evidence not going to his office. >> all health care decisions should be made only in a clinic or hospital? that is not the case. john: a medical detective for a company that advertised is heavier medical problem solved by the crowd. you submit your case to list your medical problems like paid, alert neurological problems and muscle cramping and fatigue. she sounds like a hypochondriac. could anybody give useful diagnosis through the internet? she offers a to a hundred dollar reward but i would not trust the internet diagnosis. would you? but jared says we should he is the founder.
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why? >> we have a lot of work to harness though with some of crowds even to harness the most difficult medical cases to bring the right to answers to patience while suppressing the bad answers. john: the crowd is often wiser than any woman expert. but you have these people with a myriad of symptoms symptoms, are they helped? to the average patient has been sick eight years, over $50,000 of medical expenses and c8 doctors but despite the difficulty they tell us more than 60% our crowd preens them closer to a correct diagnosis or a care. john: restarted this because your little sister had trouble? >> she spent three years with a very difficult chronic undiagnosed medical condition. she saw almost two dozen doctors, my family into
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insurance company incurred six-figure medical bills and nobody could figure it out. so we created a web site. john: what did you do? >> by that point fortunately she was diagnosed through the medical system but it's a way to much time and money. we wanted to see if maybe a crowd of people could have come up with a correct diagnosis more quickly. john: she needed no hormone patch in that salter problem and a month? >> once said the divided it was very simple horrible there be in within a few weeks she was back to normal john: did you got the same answer on your site? to make it was amazing even barrier of the with the prototype we gave the community the exact same a affirmation that the doctors had before she was diagnosed and the community came up with her correctly answer in a few days and it showed us
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there is something to the idea of crowd source madison john: how does it work? you have medical detective. >> we have to and thousand registered and a two-thirds working in or study medicine doctors, medical school students commoner's is coming but we want a diverse community for different perspectives we have acupuncture chiropractor crile's work best when they are diverse. john: dixie she lists her endless medications that she takes cover her medical history the test she has had done, the results and those that have been excluded it from that they get a good the answer? >> it is astounding we have a dozen more on the case the average will have 16 to collaborate with a very high success rate. john: severe motion sickness
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, they try everything, my? drive went from 10 down at zero in six months. >> chronic noise. what if they get a bad diagnosis? >> we make it very clear we're not in the practice of medicine we provided short list of the most probable diagnosis to discuss with your doctor gets to find a definitive diagnosis or treatment plant so the patients no better than where they started but the crowd or community provides insight that can take to the doctor to lead to secure. john: some of your -- offer rewards. >> some have thousand dollars over their many months. the primary motivation is cash but we have detectives why do spend time participating? the average active detective will spend 0910 hours as a
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volunteer that is per month. we ask them why you spend so much time? cash is number 546 but the main thing is the intellectual challenge to solve through medical mysteries. john: it is hard to believe this could work. thank you. what will happen when politicians destroy our trust in our money? ira cds really do sound like a sure thing but i'm a bit skeptical of sure things. why's that? look what daddy's got... ahhhhhhhhhh!!!!! growth you can count on from the bank where no branches equals great rates.
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and an early morning mode. and a partly sunny mode. and an clear inside mode. transitions ® signature ™ adaptive lenses... have chromea7 ™ technology... ...making them more responsive than ever to changing light. so life can look more vivid & vibrant. why settle for a lens with just one mode? experience life well lit ®. speak with your eyecare professional to... ...upgrade your lenses to transitions ® signature ™ . st john: looking at the money in your pocket will say in god we trust that that is the picture of the white house apparently died is not in charge but politicians are i don't trust them.
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but the value of russia's currency fell 50%. people who saved all their lives just lost half of their money. given the with the politicians spend that could happen here also. here is one way of. >> the first decentralize. >> and now the man who shatters conventional wisdom, john stossel. -- digital currency whether are in your mobile device it is directed person to person without going through a bank john: and presumably bitcoin hold their value because the al gore them limits the number in circulation and will not go into that but i trust them more than politicians but mine sold at $120 now they are worth more than twice that. there was a big bubble but i wish i sold them when they were worth $1,000.
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but bitcoin scare's politicians some are scared because americans use them to buy illegal things. >> carol wynne, a can of is is, ecstasy. >> sender schumer wants bitcoin restricted. black tar heroin there is a list. john: we must stop that. to pass rules and those who wrote the article about how bitcoin are used by international criminals they say don't blame bitcoin for what criminals do. so a few of us will use them? >> we want to abide by the same rules that it is a currency is to fold its own against cash.
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john: every time someone makes a deposit more than $10,000 you have to tell the government. >> by show put their briefcases five printer thousand dollars in cash they need to do paperwork to ask a few questions. >> did is interesting that he brings up money-laundering and grows the biggest laundromat is the federal treasury with a median exchange of course, -- a choice. john: most dash money is not even in america. the treasury has 1.2 trillion dollars. i understand why he goes after mom-and-pop laundromat down the street as it is just a fraction of that amount. >> but most criminals is
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very difficult to put into a bank account to pay somebody a lot of money in cash. >> is bad law enforcement. go after the criminals and find a way to catch the criminals not what's innocent people using as well. >> with $1 billion of transactions. john: that is what he was complaining about the silk road was shut down in a sting operation they did that transaction of drugs. john: people did business on the internet. >> because bitcoin and allow people to wire large amounts of money without going through a wire transfer. at. john: i want the government to know everything i spend money on. >> but those who are oppressed every single
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authoritarian regime does the exact same thing right now to hide it abroad and bitcoin is a way that they can do this they can do with much more intimate a clean dash anonymity. we have a regulated financial system that works draft politicians and lath or how much money they can steal from their system because they're becoming old -- multimillionaire's or billionaires' from theft. >> by definition you can see exactly where tax dollars are going. imagine the outcry when you see the incredible waste. that is accurate. john: we are out of time. thank you. coming up stores address
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people to pay for what you buy with no cashier. don't they get ripped off?
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stossel: some people cheat. somel. john: some people cheap to
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some steel that is why stores as cashiers to make sure you do not speak out without paying but what if there were no one there to check? this coffee shop has no one behind the counter. >> it is the amazing is that people are extremely honest when i at the end of the day people are 15 percent more generous. john: in day over pay more? that is north dakota maybe they are different but that california business trust its customers they sell strawberries, baked goods with no cashier's. i would think people would rip them off but jim cochran says they don't. know? >> no. it is amazing it is quite a phenomenon we do thousands of dollars of business in one day and it is quite
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amazing to see people experience it for the first time. john: of first you did this because you were busy there was not that many customers you could not afford the cashier but now all thes cuomerou lve cnge ailae between $5,100 and people are honest? >> sometimes somebody from germany or chicago will show up and start to scratch their heads and another customer will say here is how you do it. make your changes and they go through period of disbelief then they get adjusted to the idea then of course, they want their picture taken. [laughter] john: some people say because it is in a small town but the tea company honesty ran to -- ran
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experiments they found that we have the box where people could put the money in the least shot back and watch why and alabama were joined by the most generous with tennessee audit and alaska. blige is the most honest and women were slightly more honest than man. john: 80% in new york city were august and the least honest state was montana and idaho. there is no pattern. >> it would be interesting for someone to look at what is going through people's minds. but it makes them happy and makes us happy we love to come through the farm stand to see that happening is people have.
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>> it does it work everywhere it new hampshire one had to close because of theft a and stephen king wrote a novel asking readers to voluntarily pay a dollar for each chapter down loaded he would only do with a 75 percent paid but few were than 50 percent paid. have you been robbed? have they taken money ever? >> of course, . but is rare. we do a beginning and ending inventory. we have an idea how much product we have sold. interestingly enough we do get variations but on average it works out just about right. john: thank you for a british university once ran a trust experiment to find out people were more honest if there is a poster of the wall to show the eyes.
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nobody was watching but they with the twice as much money. who lose more trustworthy government to our business?
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stossel: whom do you trust? businesspeople? john: who'd you trust? business people? no. they just want to make money that is why americans will
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trust people who enter public service like politicians are regulators because they are more trustworthy. >> i did not have sexual relations with that woman. >> read my lips. no new taxes. >> if you like your doctor you can keep your doctor. >> the people in a government are not trying to profit but instinct tells me gb where those greedy people. that business is cannot be trusted. >> trust me i am led doctors to make these poke fun at advertisers deceit. that is why we cannot trust business except we can when i was a consumer reporter in portland oregon and new york city but when a move to a
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"good morning america" i could not find is mitt a national schemes because when the markets are mostly free the way to get rich is serve your customers well so they want more. there will be scams but word gets out of good companies grow. to get rich only if he has a good reputation and now thanks to the internet the reputation is out there. i will not go to a movie without checking rotten tomatoes first when i travel i look at what others have about hotels. i trust these much more than it the certificate of approval. once i made monday working for a company called lift the you can become a taxi driver for go before i could pick people up with maybe
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putting a stupid people mustache on my car. why would i trust i could get stranger's rights in they would pay me? why would women get in my car? because we rate each other on our smart phones. >> he gets five stars. >> have a good day. >> making a better than the government ever will. but it is all public. >> an american consumer television personality. john: you get it. reformation protects us most
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are useless and harmful and then to try new things. one allows traders to buy a home cooked meal in someone's home if you have the dinner party with strangers. >> beverages is low on the a take and when the regulators wake up they will panic and demand regulation fools in my professional acreage that. the new york cbs station already has the hidden camera expos a on underground dinner parties that are unregulated. give me a break. they trust their host that the chefs have a reputation. and government contends we
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have the place at the table but taking regulation -- reputation over regulation any day. see you next week. ♪ >> ♪ saturday in the park ♪ ♪ i think it was the 4th of july ♪ >> ♪ whoa-ooh-oh ♪ ♪ listen to the music ♪ ♪ whoa-ooh-oh ♪ ♪ listen to the music ♪ >> ♪ even the nights are better now that we're here together ♪ >> in the early '70s rock music mellowed out and showed a softer side. singer-songwriters acoustic guitars and sun-kissed melodies took over the airwaves and the sound of soft rock


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