Want to fix our economy? Boot Bernanke, and appoint THIS guy

[SoCalDem]

After watching him on Washington Journal this morning, I was STUNNED to see someone actually spelling it all out in exquisite detail..He laid the blame where it duly belongs.. Lax or NO regulation of banking, conflicts of interest in (republican) government, lobbyists running/paying for elections/writing legislation...fraud..greed..

It's way past time to have REAL economist who are willing to tell the truth, running the Fed...and explaining in REAL terms..what we are really up to..

He's not too hard to look at either :evilgrin:..would be quite an improvement over Greenspan & Beranke






Here's a snippet from a recent interview..(the WJ hour is not up yet on their website)

http://www.rgemonitor.com/blog/roubini/251661

Nouriel Roubini | Mar 26, 2008

Here is an article and interview recently published in Investment News.

NOURIEL ROUBINI: Superbear says there's more to come

By Janet Morrissey March 24, 2008, Investment News

Nouriel Roubini, one of the biggest bears on Wall Street, wasn't surprised by the fire sale at The Bear Stearns Cos Inc. of New York. He said it just reinforces his 12-point gloom-and-doom outlook, which he unleashed on Wall Street in February, and he now thinks that total financial losses in the credit debacle may top the $1 trillion he previously projected. Mr. Roubini, 49, a professor at New York University's Stern School of Business and founder of RGE Monitor, a New York-based economic research firm, was met by skepticism when he first predicted a downturn in a July 2006 report, "A Coming Recession in the U.S. Economy." Today, few doubt his early insight. Since then, his predictions have become even more dire, with forecasts of mounting financial losses and a possible "catastrophic" meltdown in U.S. financial markets. Mr. Roubini's 12-point outlook forecasts that housing prices will plummet 20% to 30% from their peak, subprime mortgage losses will exceed $300 billion and credit losses will spread outside the subprime arena to credit cards, auto loans and other areas.

He further expects monoline companies, which insure against defaults on certain municipal bonds and mortgage-related securities, to be downgraded, leading to more write-downs. Other predictions include a meltdown in commercial real estate (see story, Page 44), a wave of defaults on corporate debt and credit default swaps and a sharp drop in liquidity, which could lead to fire sales of assets. Reached by phone in Stockholm, Mr. Roubini spoke about current conditions and what he expects next.

Q. You have been quite bearish about the economy and financial markets. What was your reaction to the takeout of Bear Stearns?

A. It was not a surprise to me. Last month, I wrote a piece on 12 steps to financial disaster and my Step 9 said that one or two major financial or broker-dealer firms would go belly up, so I saw it coming, quite frankly. I put it in the context of a shadow financial system that is composed of not just broker-dealers, but hedge funds, money market funds, SIVs, conduits and so on that are all subject to a liquidity risk in addition to the credit risk. So, to me, this is just the beginning of a generalized run on these.

Q. Will we see more major banking institutions collapse or get taken out at fire sale prices?

A. Certainly some of the other broker-dealers, like Lehman Brothers , have exposure to toxic stuff like mortgage-backed securities and collateralized debt obligations, as Bear Stearns did. And all of the institutions have the characteristics of being highly leveraged, having funded themselves in forms that are very short and liquid and having done investments that are now highly liquid and highly risky. So I see other institutions being at risk — absolutely.

Q. The Fed agreed to provide financing of up to $30 billion to cover the Bear assets that were less attractive to JPMorgan Chase & Co., and this marked the first time the Fed has offered a bailout to a non-regulated bank since the Great Depression. Are you concerned?

A. It's the beginning of a radical change in monetary policy. It's not just the $30 billion that the Fed confirmed to Bear Stearns via JPMorgan — there were two other major options that went in the same direction. One was the decision to provide $200 billion so that all primary dealers, including non-bank financial institutions, would be able to swap their illiquid and toxic MBS for safe Treasuries. The other was the Fed giving any primary dealer, including non-banks, access to the Fed discount window on the same terms as banking institutions. This is a radical change; we haven't seen anything like this since the Great Depression.

These are financial institutions that are not regulated or supervised by the Fed. The Fed has no idea of whether they are just illiquid or insolvent, which creates a massive moral hazard problem. It's a radical shift in the way the Fed operates — and a dangerous way, I would argue.

Q. Dangerous in what way?

A. You're telling people that even if they have made reckless lending and investment decisions, mismanaged risk or continue to do stupid things, the government will bail them out. We are in a systemic financial crisis.

snippet

much more

[OwnedByFerrets]

1. But, but, but.......

his name doesn't sound Murikan:o How could he know how to fix America's problems?:sarcasm:

[pansypoo53219]

2. more needs to be said about

dirivatives.