Posted:
#26
ROUBINI is someone worth listening to. He was ridiculed in the early-to-mid 2000s for his doomsday scenario and gained the nickname "Dr. Doom."
The first statements from Roubini in the interview are perhaps the most important;
"....... financial crisis that starts from excessive debt and leverage from the household section, leave in a second stage to a second leg where there is a releveraging of the public sector, with large accumulation of public debt, because we need the fiscal stimulus to get out of the recession. Because we decided to socialize with losses that put the losses of the financial system now on the backs of the government. "
Long Story short... a lot of debt has been transferred from consumer to Federal balance sheets. Witness TARP (a product of people buying more house then they can afford), witness the Housing & Economic Recovery Act (again, same as above).
These measure are effectively helping bail out the consumer at the expense of the Fed..
So , what does this mean going forward. Roubini already points out that painful days lie ahead, in the form of higher taxes. I already mentioned this earlier in the thread, and is the most obvious outcome of the high federal debt load..
The first statements from Roubini in the interview are perhaps the most important;
"....... financial crisis that starts from excessive debt and leverage from the household section, leave in a second stage to a second leg where there is a releveraging of the public sector, with large accumulation of public debt, because we need the fiscal stimulus to get out of the recession. Because we decided to socialize with losses that put the losses of the financial system now on the backs of the government. "
Long Story short... a lot of debt has been transferred from consumer to Federal balance sheets. Witness TARP (a product of people buying more house then they can afford), witness the Housing & Economic Recovery Act (again, same as above).
These measure are effectively helping bail out the consumer at the expense of the Fed..
So , what does this mean going forward. Roubini already points out that painful days lie ahead, in the form of higher taxes. I already mentioned this earlier in the thread, and is the most obvious outcome of the high federal debt load..
0
Hot Forum Topics
