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Nouriel Roubini’s Profile in the Latest Newsweek

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From Newsweek:

Power 2009 – PEOPLE TO WATCH: Nouriel Roubini

For Dr. Doom, a Crash Worthy of His Warnings

By Daniel McGinn | NEWSWEEK

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With the economy in a tailspin and the layoff tally climbing, this is a tough time to be a second-year M.B.A. student who’s about to hit the job market. It may be especially tough for the students who gathered in a second-floor classroom at New York University in early December to listen to a lecture on the global economy by their professor, Nouriel Roubini. To start the class, Roubini clicked an overhead screen to show the day’s economic news. “The numbers are awful,” he said, referring to the latest unemployment estimates. He clicked to another piece of data. “That’s as bad as you can get,” he said grimly. For the next 90 minutes, Roubini—clad in a black suit, with tousled dark hair, fingering his reading glasses as he paced the front of the classroom—discussed his 15-point plan for rebuilding the global financial system. The M.B.A.s followed closely and challenged some of his points. Nothing he said should have made them optimistic, but that’s hardly a surprise: there’s a reason Roubini’s nickname is Dr. Doom.

Roubini, who began making dire predictions about a U.S. economic collapse back when Americans were still busy flipping condos and doing cash-out refis, has become the oracle of the financial crisis. As early as mid-2006, on his well-read blog and in speeches, he explained why the bursting housing bubble would drive an unusually severe recession. He predicted mortgage defaults would cause financial institutions to fail, and that soaring oil prices, combined with falling home prices, would cause debt-ridden consumers to dramatically cut spending. At the time, most economists were predicting a “soft landing,” and even those forecasting a housing downturn didn’t foresee its deep impact on the financial system. Today Roubini scoffs at their optimism. “[My view] was so obvious, I don’t know how anyone could argue otherwise,” he says.

Roubini was born in Turkey to Iranian parents, but spent most of his early years in Italy. He came to America in 1983 to earn his Ph.D. at Harvard and never left. During the 1990s he taught economics at Yale and NYU, but he also dabbled in policy, spending summers at the International Monetary Fund, the Federal Reserve and the World Bank; for two years he worked alongside Larry Summers and Tim Geithner in the Clinton White House and Treasury Department. During that time he began closely studying the financial collapses in Mexico, Argentina and other developing economies, eventually coauthoring a seminal book on the topic. By the late 1990s, he’d begun posting his views on a blog that became a must-read for economy watchers.

Unlike economists who rely on complex math models to do their forecasting, Roubini operates more like a meteorologist, sifting through data, watching patterns and looking for similarities to past events. By 2004, Roubini was becoming alarmed by America’s “twin deficits” as both the federal budget shortfall and trade imbalance grew wider. Despite its size, he wrote, the U.S. economy was starting to resemble an emerging market on the verge of collapse. In 2006, his pessimism shifted to the overinflated housing market as the catalyst for a U.S. downturn. During this time, he recalls taking a day off from a Las Vegas conference and driving out to the desert, passing mile after mile of newly built, unoccupied homes. “They were ghost towns,” he says. “If this isn’t a housing bubble that’s going to pop, what is?” At the time, many mainstream economists disagreed with his calls. During a debate at the IMF in 2006, Anirvan Banerji of the Economic Cycle Research Institute derided his “subjective forecasting by selective analogy to past episodes that favor his bearish views.” Even now, with much of the scenario Roubini spun out proving true, other observers point to inconsistencies. “He deserves a lot of credit for warning people early on about the possibility of a severe financial collapse,” says Brookings Institution economist Martin Baily. “[But] I do not think the way the crisis has happened exactly fits what he says.”

Roubini says he takes no pleasure from the current economic hardship. Still, he’s not saying he’d prefer to have been wrong. “You’re glad in the sense that, if you’re intellectually honest, you’re found out to be right, [even if] you don’t go around and gloat,” he says. Despite his prescience, he’s suffered just like the rest of us: he’s remained fully invested in stock index funds through the market downturn, causing his portfolio to plummet. And he has no expectation of a quick turnaround. He thinks the recession will last until the end of 2009, with the economy contracting a severe 4 or 5 percent, and unemployment peaking at above 9 percent in 2010. Stocks have further to fall, he says, suggesting the Dow could bottom out around 7,000. He’s encouraged by the incoming Obama administration’s talk of a big stimulus package, though, and expresses confidence that Summers and Geithner will prove aggressive recession fighters. And though critics may dismiss Roubini as permanently dour, he says that’s not necessarily so. “Eventually, when we get out of this crisis, I’ll be the first one to call the recovery,” he says. “Then maybe I’ll be called Dr. Boom.” In his view, alas, that name change could be a long time coming.

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195 Responses to “Nouriel Roubini’s Profile in the Latest Newsweek”

JimmyTheBanker • December 23rd, 2008 at 9:08 am

Irregularity Uncovered at IndyMacBy EDMUND L. ANDREWSPublished: December 22, 2008WASHINGTON Two months before IndyMac Bancorp collapsed in July, at a cost of $8.9 billion to taxpayers, a top federal banking regulator allowed the bank to backdate a capital infusion and gloss over its deepening problems, the Treasury Department’s independent investigator said Monday.In what industry analysts said was an example of the excessively cozy relations between high-flying subprime lenders and federal bank regulators, the Office of Thrift Supervision’s West Coast director allowed IndyMac’s parent company to backdate an $18 million contribution to preserve its status as a “well-capitalized” institution.Investigators reported that similar officially approved backdating appears to have occurred at other financial institutions, though they did not name them.

JimmyTheBanker • December 23rd, 2008 at 9:11 am

By Joe MysakDec. 23 (Bloomberg) The accountant who predicted the nation’s largest municipal bankruptcy says as many as 10 insolvencies will roil the $2.7 trillion U.S. market for state, county and city debt next year as public finances worsen amid calls for federal aid to state and local governments.John Moorlach said in 1994 that Orange County, California’s leveraged investing strategy could wreck its finances. The county went bankrupt about six months later after losing $1.6 billion.As many as four cities in the Golden State and six others nationwide may seek court protection from creditors next year under Chapter 9 of the bankruptcy code, the section devoted to municipal governments, Moorlach said in an interview.“The total could be higher,” said Moorlach, 53, now chairman of the Orange County Board of Supervisors. He didn’t name any cities outside California, which has seen the cost of insuring state debt against default more than quadruple since September. He said his estimate was based on general economic conditions.States project a $97 billion shortfall over the next two years, according to the National Conference of State Legislatures. This mounting pressure on public finances gives President-elect Barack Obama’s administration “strong incentives” to provide federal aid, wrote George Friedlander, a municipal strategist at Citigroup Inc., the largest U.S.underwriter for tax-exempt bonds, in the firm’s Dec. 12 Municipal Market Comment

aerial view • December 23rd, 2008 at 9:23 am

We can have all the rules of conduct and regulation in the world, but unless we have HONEST, INCORRUPTIBLE people enforcing them, we will remain under the power of the corporate elites.

CM • December 23rd, 2008 at 9:37 am

That really was a key “save” by “whomever” at yesterday’s close. We were threatening to take out the Dec 12 low at the close yesterday which would have been a no-no. TOday, we rally because of it. Free markets my a$$!

FAMC • December 23rd, 2008 at 9:38 am

If Martin Baily really said “[But] I do not think the way the crisis has happened EXACTLY fits what he says.” I think Baily need to travel to the temple of Ammon, and ask Alexander’s oracle spirit how the crisis will unfold exactly.For analysis, Roubini. For solutions….. Hum… Houdini.

jomos • December 23rd, 2008 at 9:50 am

My belief is the FED was established with a power of separation from normal government fiscal operations on purpose. It is also my belief that in short order the FED will prove itself impotent in it’s charter and be recognized as a problem and thrown out in disgrace as a discarded old idea. The FED is obsolete. But the separation of power vested in the FED to print notes, will be thrown out with the FED. To that point, only coined money minted by the Treasury will be money until a new currency is perceived. Do you see the distinctions between the FEDeral notes and coined money ? Comments welcomed!Reply to this comment By jomos on 2008-12-21 07:03:45

jomos • December 23rd, 2008 at 9:54 am

12/19/2008 16:54ASIA – UNITED STATESU.S. debt approaches insolvency; Chinese currency reserves at riskby Maurizio d’OrlandoIn a few months, America’s public debt has grown to more than 100% of GDP. Fear of a valuation crisis for the dollar, with tremendous consequences for Asian countries, major exporters to the United States.Milan (AsiaNews) – In the United States, the danger of debt insolvency is growing, putting at risk the currency reserves of foreign countries, China chief among them. According to new figures published by Bloomberg in recent days (Nov. 25, 2008 [1]), the American government has employed a total of 8.549 trillion dollars to stop the financial crisis. This means a total of about 24-25.4 trillion dollars of direct or indirect public debt weighing on American taxpayers. The complete tally must also include the debt – about 5-6 trillion dollars – of Fannie Mae and Freddie Mac, which are now quasi-public companies, because 79.9% of their capital is controlled by a public entity, the Federal Housing Finance Agency, which manages them as a public conservatorship.In 2007, public debt in the United States was 10.6 trillion dollars, compared to a GDP (gross domestic product) of 13.811 trillion dollars. Public debt in 2007 was therefore 76.75% of GDP. In just one year, direct and indirect public debt have grown to more than 100% of GDP, reaching 176.9% to 184.2%. These percentages exclude the debt guaranteed by policies underwritten by AIG, also nationalized, and liabilities for health spending (Medicaid and Medicare) and pensions (Social Security)[2]. By way of comparison, the Maastricht accords require member states of the European Union (EU) to reduce their public debt to no more than 60% of GDP. Again by way of comparison, in one of the EU countries with the largest public debt, Italy, public debt in 2007 was equal to 104% of GDP.In 2007, 61.82% [3] of America’s public debt was held by foreign investors, most of them Asian. So the U.S. public debt held by nonresident foreigners is equal to about 109.39% (113.86%) of GDP. According to a study by the International Monetary Fund, countries with more than 60% of their public debt held by nonresident foreigners run a high risk of currency crisis and insolvency, or debt default. On the historical level, there are no recent examples of countries with currencies valued at reserve status that have lapsed into public debt insolvency. There are also few or no precedents of such a vast and rapid expansion of public debt.The United States also runs large deficits in its public balance sheet and balance of trade. Families and businesses are also deeply in debt: in 2007, American private debt was equal to a little more than 100% of GDP. At the moment, it is not clear how much of America’s private debt has been “nationalized” with the recent bailouts.In the early months of next year, when the official data are published, the United States will run a serious risk of insolvency. This would involve, in the first place, a valuation crisis for the dollar. After this, the United States could face a social crisis like that in Argentina in 2001. http://www.asianews.it/index.php?l=en&art=14054

PeteCA • December 23rd, 2008 at 10:15 am

Someone quoted John Hussman before, but let’s look at his comments again. See “Dollar Crisis Begins” at the following link:http://www.hussman.net/wmc/wmc081222.htmFirst, I certainly agree that we’re right at the onset of the dollar crisis. Personally, I just did not expect things to be as critical at this juncture as they actually are.Prof Hussman notes that the outcome is either US Treasuries going down (tanking), or the US dollar tanking. Yes, in principle that’s true. And since the market for UST’s and bonds is enormous and liquid, there’s a pretty good argument that the credit market will do whatever it’s going to do. But with the remarkable step of the Fed literally printing money and throwing it into UST’s, I have argued here that the Fed will aim to prevent any rapid collapse in bond prices. And they’ve got a reasonable chance of succeeding. In practice, I suspect the Fed intends to simply buy any US debt that is sold off by countries like China or Japan. It’s incredible to contemplte – but that’s where we are.So the real alternative is the dollar going down. Paulson and Bernanke have always wanted this outcome – arguing that it wil improve US competitiveness in exports. Of course, what they never say is that it will also increase price inflation for Americans, lower our living standard significantly, and ruin our savings and retirement plans. But, Oh Well.Unfortunately, there is another fly in the ointment with a crash in the US dollar. Several actually. But let’s look at one. The economy of Japan. Take a look at the yen/dollar ratio. Unless I miss my guess it’s trading pretty close to 90 as I write this today. That is a target level set by the Bank of Japan. At this stage the Japanese just cannot afford for the yen to rise rapidly against the dollar. Their own economy is teetering on the brink of serious recession or outright depression. Toyota just announced its first losses in recent history. A crash in the US dollar would precipitate a disaster in the Japanese economy. Unless the yen follows the dollar downwards at the same rate (yen pegged to dollar). So the idea that the USA can just arbitrarily allow its currency to decline rapidly, or crash, is thrown out the window.My point is this … we appear to have reached the point where flexibility in the intl currnecy system is largely gone. There are major economic ramifications now if the dollar sinks rapidly against the yen or the euro. It looks like the world is teetering on the brink of a currency crisis.And right now this is playing out especially with the two major economies that have collapsed into ZIRP policies. The fate of the USA and Japan are intertwined. The two countries could pull each other down into a depression, and possibly drag the rest of the western econmoy in the same direction.PeteCA

PeteCA • December 23rd, 2008 at 10:22 am

Earlier, on other threads at this blog, I have argued that the collapse in oil prices is going to lead to economic instability in some countries. This could certainly result in a Debt Revolt in South America – with Ecuador leading the way in bond defaults (and Venezuela jumping on the bandwagon).But what worries me more is what’s brewing in Russia. I just don’t see how Putin and Medvedev can tolerate this situation, knowing that the huge swing in oil prices has been precipitated by financial instability in the USA. Here is the article. Connect the dots in your own mind and see where this goes …http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/3870089/Protectionist-dominoes-are-beginning-to-tumble-across-the-world.htmlPeteCA

jomos • December 23rd, 2008 at 10:26 am

Discover the Top 100 Safest U.S. BanksA FREE 10-Page Bank Safety Report From Club EWIMost of us think the term “deposits” mean funds that you deliver to the bank for safekeeping. But the fact is that for nearly 200 years, courts have sanctioned an interpretation of the term “deposits” to mean a loan to your bank.As market declines and banking turmoil continue to dominate the headlines, this is no time to listen to the media try to tell you not to “panic.”Take action!Join Club EWI free to read your free report, “Discover the Top 100 Safest U.S. Banks.”

Mandarin • December 23rd, 2008 at 10:35 am

The lack of flexibility is the flip side of another relationship: current international balances of trade and payments. The currency parities seem to lock these balances in. Seemingly the parities cannot move or realign because there would be similar realignment in the flow of goods and money internationally. And the system has been operating just fine with these flows – up to now. But the dollar can’t act as the financing vehicle, so the whole trading structure is dysfunctional. Result: the contraction of world trade. So the powers seem to have the choice of maintaining the system at a kind of parity and seeing the volume of trade shrink, or of retiring the dollar as the financing mechanism. If the latter happens – and it seems to be just a matter of time – the dollar will fall dramatically and much more than it did last year. Gold would have another huge rally.

Guest • December 23rd, 2008 at 10:36 am

excellent post! people must read this! What do you think would happen if this story made front page of the Wall St. Journal? If the DOW doesn’t tank to a minimum of 6000 next year, then I’m a monkey’s uncle and you start sending me bananas as that’s probably the only food I’ll be able to afford!

PeteCA • December 23rd, 2008 at 10:50 am

Which is why I was speechless at the lack of progress from the last meeting of the G-20. Critical action was needed to remove the dollar as the global reserve currency. It never happened. It was needed THEN – it wasn’t optional.PeteCA

Mandarin • December 23rd, 2008 at 10:53 am

Yes, unbelievable isn’t it? I guess now we know how past leaders made those “incredible” mistakes like Smoot-Hawley. No brainers, except for leaders trapped by national self interest and inertia.

aerial view • December 23rd, 2008 at 10:59 am

CURRENCY EXPERTS: Do you think the upcoming currency crisis increases or decreases the chances of combining U.S., Canadian and Mexican currency into one, namely, the Amero? If not, then as all currencies race to the bottom, will we have a world hyperinflationary apocalypse?

jomos • December 23rd, 2008 at 11:05 am

The bottom line is the $500 trillion unwind of fractional shadow banking debt worldwide is destroying the $10′s of trillion being taken from productive banking future investment. This in turn, produces more destruction to central bank balance sheets as deflation is being seeded by present fractional banking coordinated policies. The velocity of money movement is slowing. The death knell of fractional banking and all who make a living under their system.

Mu Gua • December 23rd, 2008 at 11:12 am

Sure there could be an Amero. But it would be part of a bigger political package. The central banks of Canada and Mexico would be directly under the control of the Federal Reserve with the Amero being backed by the mineral wealth of our neighbors. How likely would they be to consent to that? Think of it this way: when the Nazis conquered Europe, did the German Mark become stronger? In one sense, yes. In another, no. The Amero would only be as strong as the economy of the North American union was sound. And right now the combination of the three countries looks like it would be weaker than the weakest link. Your description of all currencies racing to the bottom is very appropriate because the liquidity injections are huge in Britain France and China right now. Germany is holding back. Russia, the Arabs, and the rest of the world don’t have the luxury. Very inflationary, of course and especially because the oil and mineral producers would form an ironclad cartel purely to survive. Incidentally, the pressure on Canada and Mexico to join such a cartel would be strong….I leave it to you to imagine some of the future scenarios.

jomos • December 23rd, 2008 at 11:13 am

If control of money movement is a central bankers greatest desire, than consolidation of previous independent individual money flows into coordinated blocks would benefit their desires. Your Amero is a stepping stone to consolidation of three worldwide block of capital into ultimately one. Agree ?

jomos • December 23rd, 2008 at 11:19 am

Sometimes you have to get your news outside the US news wires to see what others are thinking. American’s have no memory of bad currency like most of the rest of the world.So we are more gullible!

Guest • December 23rd, 2008 at 11:23 am

I must admit I feel a little bit guilty. Here I am with some taxable gains for 2009 (because I listened to Dr. Roubini) while the genius himself has lost over 40%.

aerial view • December 23rd, 2008 at 11:29 am

Both replies above make sense. It would seem that a greater benefit to the U.S. would be to merge currency with the Euro rather than the Canadian dollar or Mexican peso. I can’t imagine that Japan, China or Saudi Arabia, Russia, etc would be part of a single new currency unless they had no other choice. And since the philosophy of our govt has been “wait until the avalanche has occurred until we start calling the ski patrol” rather than preventing the conditions leading to an avalanche, I think we will see unprecedented moves and discontinuity in the currency markets for awhile; but, I am not really well versed in these markets so I welcome any other opinions.

Duty to Self Happiness = Never Steal • December 23rd, 2008 at 11:34 am

There’s a real point to this:Dear America,I am quite sanely and unshakably devoted to my own best happiness. I mean to get all the happiness out of life that is possible from life – every drop. It’s my mission in life. I believe that is life’s purpose – to be happy – and that it is my DUTY to pursue my happiness with every nerve and every second I’ve got.And I am in NO UNCERTAINTY about the fact that if I take more from the pool of wealth than I worked to put in, that money had to come from someone who had to take less than he worked to put in, and so it is theft of someone else’s labor, someone who is out there in my environment, overworking to compensate, angry about the unjust, injurious theft – and that is the biggest, surest harm and threat to my maximum happiness. No safety, no happiness.Yes. I have internalized the understanding that taking from the pool of wealth more than I contributed, decimates my happiness, guaranteed. I see it is impossible to gain my greatest happiness by taking more than I put in.Therefore, because remember – I am unapologetically all ABOUT my own best happiness – I am uncorruptible. You couldn’t give me above world average hourly pay if you got out the waterboard.Signed,Will Be President for the world-average hourly payrate, NO less, and NO more – ever. (It’s around $40 US)

Guest • December 23rd, 2008 at 11:39 am

URGENT: Federal prosecutors asking Illinois House committee not to dig into criminal charges against governorGeez, who is involved here they don’t want us knowing about?????

FAMC • December 23rd, 2008 at 11:40 am

Dr. Roubini, please answer my questions. Use your blog.Do not confuse me.Honest but Intriguing!”Despite his prescience, he’s suffered just like the rest of us: he’s remained fully invested in stock index funds through the market downturn, causing his portfolio to plummet.”Why did you not pay attention to your analysis?If you do not act on your analysis, why others should act?Confidence? Probabilities against your scenario?

Anonymous • December 23rd, 2008 at 11:41 am

Dr Roubini does not ever invest actively; he has said sevral times that he has never bought or sold an individual security in his life. He saves for the long-run in passively managed indexed equity funds; and in the long run the return on equities is higher than any other investment. So unless you can exactly time a market a buy and hold long run strategy makes sense. it is a much better approach than having the Madoffs – or ANY other active manager that charges high fees and makes worse than the index 90% of the time – manage your money. Small investors should save in passively managed index equity funds for the long run. That is his investment philosophy and practice.

Hayes • December 23rd, 2008 at 11:42 am

Not an expert but I think it would take a dramatic escalation/downward turn in the financial/economic crisis to gain the political capital to engineer such a combination -

Mother of God • December 23rd, 2008 at 11:47 am

For You, Average Jane – and for the men on Wall Street?Write this down, Fellas!7 out of 10 of the world’s hungry are women and girls.Women do two-thirds of the world’s work, receive 10% of the world’s income, and own 1% of the means of production.Women make up 60% of the world’s working poor; people who work but do not get paid enough to lift themselves above the $1 per day poverty line.Elderly women are 70% more likely to be poor than elderly men.Women account for 64% of minimum-wage workers in the USA.Women in the USA get paid 77 cents for every $1 paid to a man in 2005. In the developing world, it’s 73 cents. Even worse, of course, for women of color: Black women, it’s 63 cents. For Latinas, it’s 53 cents.Of the 37 million people living below the poverty line in the USA, 21 million are women.More than two-thirds of the world’s unpaid work is done by women – the equivalent of $11 trillion or almost 50% of world GDP.In many regions women provide 70% of agricultural labor and produce over 90% of food.The women of Africa walk the equivalent of a trip to the moon and back 16 times a day to supply their households with water.Two-thirds of children denied primary education are girls.Global average proportion of women in Parliament is just 17%. The USA ranks 67th with a mere 16%.Over the past decade, women’s work has contributed more to global growth than has China.Want more? Go here:http://www.womenfightpoverty.org/docs/WorldPovertyDay2007_FactsAndFigures.pdfMeanwhile, the top nine richest men in the USA have money that rakes in (with no work done at all) $150.00 per second every second of their lives, 24 hours per day, 7 days a week, 365 days a year.Want more? Go here (and by all means sign up for the most excellent Monday emails Sam Pizzigati offers):http://www.cipa-apex.org/toomuch/tmweekly.html(pst pst, Painter..i left some replies in the previous thread as we changed over. one is to you. i have to go for a few hours now. be back later)

Guest • December 23rd, 2008 at 11:52 am

“talk is cheap, but action requires one to put their money where their mouth is”! I don’t think we’ll get a response from NR.

aerial view • December 23rd, 2008 at 11:56 am

good post MOG! No question we need a “humane living wage” but figuring out how to get their in our lifetime will be a great challenge; of course, “all things are possible with God” so, it can be done!

Guest • December 23rd, 2008 at 11:57 am

Remember Joe Biden’s remarks to that audience when he didn’t know he was being recorded? Didn’t that give everybody a chill up their spine?We’re FOOLS to imagine these banksters and politicos aren’t going to do whatever they want as long as they have people’s acquiescence.

Mom • December 23rd, 2008 at 12:06 pm

will do, blindman. this evening. thanks for giving that link again. i have to make myself get off here for awhile now, though. the lasagne for christmas eve isn’t going to prepare itself, and i’d have to face hungry, clamoring hoardes. thanks for kind words, friend. did you catch that my skype-name is global empress of myself? lol! i don’t wanna rule nobody else…any more than i’m about to let them rule me. i don’t ever want to work THAT hard!

Guest • December 23rd, 2008 at 12:06 pm

This was my approach too. However, after reading the Prof’s blog day after day it made sense to sell and sell everything I did and I am damn glad I did. But now even though he says the market will go down another 20% I will now follow his actions instead of his words this time and I will start off the new year by getting back into the market and buy his passive broad indexes, just at a better price.

Guest • December 23rd, 2008 at 12:09 pm

Maybe it was a timing issue. He knew the problems but could not time exactly when to get in and out so he just stayed in.

Guest • December 23rd, 2008 at 12:11 pm

Maybe the Prof. did not have a significant amount and just put his change on autopilot while he told the rest of the world how to save their fortunes.

Guest • December 23rd, 2008 at 12:11 pm

1:03 p.m.[AXP] American Express gets approval for $3.39 bln in TARP funds12:42 p.m.CIT Group enters definitive pact for $2.33 bln from TARP

Guest • December 23rd, 2008 at 12:13 pm

He hedged himself.He makes a living being Dr. Doom. (short)But he was a stock investor just in case he was wrong. (long)

FAMC • December 23rd, 2008 at 12:23 pm

I like the analysis of Roubini.(very interesting and informative)I do not like many of his proposed money injections solutions neither I think Geithner-Summers are so good a team.I think many people read his analysis to get a clue about what to do.Considering that he stayed on a passive fund we can conclude that he was not so sure about the magnitude of the “correction” and he has frozen like many people, expecting FED actions would bailout the market.(Or the money on that fund was 5% of his funds.)How much (percentage) NR had on the passive fund?The problem is he can analyse much data that avg Joe hasnt.Therefore, I

Guest • December 23rd, 2008 at 12:28 pm

So for the new year do I get back into the market or should I stay out? On the one hand this blog “says” wait for the additional 20% downturn and on the other hand the “actions” say buy and hold broad passive indexes and you will be doing what he does just at a better price point.

aerial view • December 23rd, 2008 at 12:40 pm

MARKET CONTROL: I wonder what would happen if everyone here and others we know all played the market (ie Dow mini futures) together-we would all sell or buy at predetermined points; how much buying power would we need to be successful? Any input from Jimmy the Banker, Pete CA, Jomos, CM, London Banker, OR, etc. Isn’t this what GS, PPT and all the hedge funds do to put the odds in their favor?

Hayes • December 23rd, 2008 at 12:46 pm

Cerberus has suspended/reduced redemptions in many of its funds — down 15.8% mostly in October – on a RMBS bet

Hayes • December 23rd, 2008 at 1:06 pm

U.S. Economy: Housing Prices Collapse at Near-Depression Pace

Dec. 23 (Bloomberg) — Sales of single-family houses in the U.S. dropped in November by the most in two decades and resale prices collapsed at a pace reminiscent of the Great Depression, dashing hopes that the market was close to a bottom.Purchases of both new and existing houses dropped 7.6 percent, the biggest decline since January 1989, to an annual rate of 4.43 million, government and industry figures showed today. A 13 percent drop in the median resale price was the most since records began in 1968 and was likely the largest since the 1930s, the National Association of Realtors said.

http://www.bloomberg.com/apps/news?pid=20601087&sid=aQ7HBEgYCzUE&refer=home

Hubbs • December 23rd, 2008 at 1:32 pm

Probably because 401 K probably represents a small amount of earned income from his NYU salary. Now earned income from outside sources, that may be another matter and treated differently than his 401K

Hayes • December 23rd, 2008 at 1:40 pm

I’ve observed since you tipped me off on the 10 minute Moving Avg on the SSO – that if you overlay a 14 minute simple and 10 minute exponential – invariably when the exp crosses the simple in an opposite direction it proceeds in that direction – I played it earlier but with just a small bet e.g. I need 7cents just to cover the commissions – so I got trapped but I’ll watch the pattern a bit more to see if there’s anything to it

Guest • December 23rd, 2008 at 1:44 pm

My heart goes out to his family. It’s only money people. But on a side note, and I don’t mean to be cold, but if these Wall Street suicides are not a buy signal I don’t know what is.

ALA • December 23rd, 2008 at 1:52 pm

Will we be in recovery at the end of 09, May by if the consumer who has been addicted to easy credit can get more credit, or has the consumer decided to cut back on buying and decided to save every dime from here on. This whole recovery totally depends on the consumer and I do not believe the consumer is able or willing to consume at the rate needed to revive this broken system. The treatment for severe drug addiction takes 2 years of recovery with behavior modification therapy and even then many of those relapse. However the consumer’s drug or credit in this case has been taken from them, the dealer is gone they have no alternative but to go thru de-tox. Living within their means won’t be easy and those who need a steady line of credit for refinancing their own debt are finished and they will not be able to participate in the recovery as they are maxed out. Even if they file bankruptcy no bank would lend them money in the new lending environment. The consumers knowingly were living beyond their means and most will not have a desire to make the same mistake twice. Those who saved and acted responsibly are watching with amazement and won’t be letting go of their money anytime soon. I believe there are too many variables not being considered, someone who could borrow for anything at any time will now have to abide by strict lending standards and most will not qualify. Recovery in 2009 or 2010 is being very optimistic in my opinion.

Octavio Richetta • December 23rd, 2008 at 1:58 pm

The market is trying so hard to have its Xmas rally but the barrage of bad news doesn’t stop, and won’t stop. It is very difficult to see the market not testing the November lows in Q1’09.As Maulding said in his latest piece, deflation is about people waiting for lower prices. Hussman may be right, the stock market may be fairly price but it looks like it is caught in a deflationary spiral: Why buy now if you can buy later at a lower price?

Guest • December 23rd, 2008 at 2:02 pm

I am glad the Madoff fraud is the only one of its kind out there. You would think there would be several more to come.

Hayes • December 23rd, 2008 at 2:06 pm

American Express to Get $3.39 Billion in TARP Funds (Update1)Buffet has done okay by the TARP -http://www.bloomberg.com/apps/news?pid=20601087&sid=aojH5YQChWLI&refer=home

OR • December 23rd, 2008 at 2:15 pm

CR has some pretty good stuff on housing. It looks like asset deflation continues its relentless course.House prices: falling.Stock prices: falling.Commodity Prices: falling.Bond prices: ???

Guest • December 23rd, 2008 at 2:15 pm

No doubt the first quarter will see the horrible Christmas numbers as well as the defaults in commercial mortgage. Those waiting until after Christmas to lay off will begin in earnest in January. This as well as others to numerous to mention will start the 20% or more drop.

CM • December 23rd, 2008 at 2:19 pm

If this level gives out, you could see a BIG rout on SSO down to the $21 level. If that does not hold, it is off to test the lows we go. I can see why there is sooooo much mystical support at this level. HO HO HO

painter • December 23rd, 2008 at 2:43 pm

who would not give up their wages and settle for $40 per hr knowing that all those starving children around the world will have food and shelter. Would anyone consciously chose greed over a human being ?

Guest • December 23rd, 2008 at 2:46 pm

http://www.census.govstatistics are great but are often not true and can be misused to make ones point.I’m not implying your stats are not true!Real median earnings of men age 15 and older, who worked full-time, year-round declined 2.3 percent.Women with similar work experience saw their earnings decline by 1.0 percent.The District of Columbia had the highest ratio of women’s-to-men’s earnings (93.4 percent). In fact, there was no statistically significant difference between women’s and men’s median earnings in Washington, D.C.Income inequality decreased between 2006 and 2007, as measured by shares of aggregate household income by quintiles and the Gini index. The share of aggregate income received by households in the top fifth of the income distribution declined, while the shares for the third and fourth quintiles increased. Meanwhile, the Gini index declined from 0.470 to 0.463, moving closer to 0, which represents perfect income equality (1 represents perfect inequality).Stats used for gun control: Gun Accidents Kill more than 500 Kids a Year.Other stats- A child is far more likely to be accidentally killed by other things than a gun according to CDC statistics. Over 1,400 children were killed by cars; almost 260 of those deaths were young pedestrians. Bicycle and space heater accidents take many times more children’s lives than guns. Over 90 drowned in bathtubs. The most recent yearly data available indicates that over 30 children under age 5 drowned in five-gallon plastic water buckets.

Softwarengineer • December 23rd, 2008 at 2:56 pm

RETIREMENT LOSSESI’m on Dr Roubini’s side; I didn’t sell retirement matching funds in stocks either. What difference does it make?Unless some of you bloggers are made of money; how in Hades are we gonna save enough principle to retire on investmestments in 2-3% CDs or money markets? The year 2100? I’m working until I die.Even the NEOCONs are putting our Middle Class Social Security, i.e., say $2-3K tax free per month benefits on a pedestal now….as even they know it would take $1-2 million principle in the bank to see that kind of partial retirement return after taxes.I know, reverse motgage your house or live on the principle so you can eat while you’re retired….lol…The sad part of it is, if the Baby Boomers don’t quit their jobs and retire normally, the young ones don’t get the open job slots and worse yet; the economy doesn’t get the retirees spending money on plane rides, luxuries and cars; like the previous generation’s retirees did. They just keep saving their money in 2% low return accounts for the rest of their lives.

CM • December 23rd, 2008 at 3:04 pm

You will find it can trade against the average it mimicks so it actully can give you heads-up on significant trend changes.

OuterBeltway • December 23rd, 2008 at 3:55 pm

To all my friends on RGE:Best wishes for a great holiday season.Come what may in 2009, I can’t think of a better gang of rabble-rousers to roam the halls of non-power with.Maybe this year we can sneak under the fence, and get a better seat.Here’s lookin’ at ya, folks!PS: To our gracious RGE hosts, I say thanks again for letting us participate in the great RGE facility. We come here because it’s the best. Thank you!

Guest • December 23rd, 2008 at 4:44 pm

The women of Africa walk the equivalent of a trip to the moon and back 16 times a day to supply their households with water. Is this supposed to be 16x per year? The math doesn’t work out per day.

Ed • December 23rd, 2008 at 5:17 pm

It is not the debt, but the cost of the service of that debt to GDP that matters.In other words, how much will it cost to pay interest and principal on that debt vs how much money do we make per year.

Guest • December 23rd, 2008 at 6:05 pm

I would add to this by saying the fundamental problem is that wages cannot support the current price levels. Either prices have to come down across the board 30 to 40%(estimate) or wages have to come up 30 to 40%. This would be the simple answer to our problems however the federal deficit, currency manipulation/warfare, and over leveraged banks makes it a much more serious and complicated problem.

I cringe again • December 23rd, 2008 at 6:07 pm

“The consumers knowingly were living beyond their means and most will not have a desire to make the same mistake twice. Those who saved and acted responsibly are watching with amazement and won’t be letting go of their money anytime soon.”There it is again, the enemy’s outpost in everyone’s head: we who lost our jobs are simply irresponsible overspenders, we’re at fault, never mind the totally rigged system rigged against us “consumers” and the billionaires riding off into holiday vacations, laden with other-earned wealth.sigh.

Guest • December 23rd, 2008 at 6:16 pm

Just guessing from other thing he’s said it sounds like he isn’t a big investor maybe his holdings were all 401k related? Some people invest in something and just stay put meaning they don’t bet the whole farm so a loss wouldn’t be catastrophic. In any case if it were true that N.R. doesn’t take his own economic advice that would then suggest a level of insecurity or doubt when push comes to shove. That would further demonstrate to me how complicated his forecast are given his own self-doubt? Again just taking random guesses.

Mother of God tonight's CBS news was sad • December 23rd, 2008 at 6:22 pm

growth industries:bankers coffinsinvestors coffinspaupers coffins coffins coffinscoffins for working women and men and for the foreign we bombNobody gets out of the overpayunderpay dystem alive – nobody.We could stop investing in the growth of death. Investment in Pay-Justice would return the biggest dividend there is.

GSM • December 23rd, 2008 at 6:30 pm

Some weeks back I commented that the next phase in the USD’s collapse should start before year end. The USD crisis will last years and possibly a decade and this has already begun.Nobody can foretell the ultimate outcome save that investments based in USD’s are going to be subjected to much crisis, except perhaps PM’s and some other commodities. I might add that the USD crisis will be accompanied by it’s evil sister- the US sovereign debt crisis.It may well be that to preserve the dollar, in the end it may need to be backed by something for ultimately, all faith in US script will be largely destroyed. We see the evidence for this appearing already with states and counties in insolvency, millions of state and fed jobs to be lost, the trillion $’s black holes now coming into focus in state and fed govt pension funds (the current and future mandated obligations of which must be found through liquidations or tax $’s.) and the US Govt’s balance sheet and debt mechanisms virtually out of control. I know a train wreck when I see it.In my head I know one should never write off the US. But given all that has transpired this year, I still see a people living in a fools paradise- where they believe by virtue of nothing more than their nationhood that the world must lend it money hand over fist. That won’t happen any longer of course. So, the next step will be to create the stuff they need most- money. Therein lie the seeds of the US demise. For rather than work and produce to create wealth, there remains firm believe that faith is good enough to do it. Just print it and they will come.I will put my faith elsewhere and I recommend that anybody with US exposure finds a way to do the same before it is too late.

Guest • December 23rd, 2008 at 6:35 pm

It’s unbelievable people just don’t get it but you can’t really fault these people because they are so incredibly out of touch they have no idea that the cost of living is 2 to 3 times the level of common wages. They simply see everything through the color of their own lenses; since they are making enough to survive or thrive on everyone else must simply be irresponsible.It’s similar in the logic the states use when they get their municipal forces (police) to be tax collectors enforcing huge fee’s/penalties and costs to the very people who can’t afford it- then they say,”it’s your fault your being penalized because you’re so irresponsible.” Though the people writing these laws have no problem paying- they are out of touch. Too few people who control the system are out of touch with what the masses are going through- or worse yet they simply do not care.

Mother of God • December 23rd, 2008 at 6:42 pm

Your quintile innaccuracies and irrelevancies, and your gun-stat distractions, Guest, are obfuscations that cloud relevant fact. Did the Cato Institute send you to this block?Walk the world. You won’t have need of statistics to know what the real deal is.

Mom • December 23rd, 2008 at 7:12 pm

painter, can i re-word that?Who in the 1% overpaid would not give up Overpay, and come to vastly prefer getting guaranteed global Fairpay, once they knew it would mean the end of children being starved, the end of homelessness, the end of millions of girls laying down in the sex-trade every year, the end of millions going blind for lack of 4 cents worth of vitamin A, end of trillions in costs of order-keeping, no more warmongering, no more somebody getting rich making landmines, no more buying hospital beds for landmine victims, no more destroying infrastructure so the destroyer’s friends can get rich doing it and also re-building what was wasted…increased literacy, increase of entrepreneurs, advancement of science and medicine, the end of high taxes, ability to save for retirement magnified, happy smiles on every person you meet on the street, 100-fold increase of safety and peace?That list of benefits of pay-justice capitalism is barely a start, too.

painter • December 23rd, 2008 at 7:24 pm

please do, just as you did with my “accident” commnet. you speak what i can not as i am sure you do for many, even if they dont know it

Mother of God • December 23rd, 2008 at 7:39 pm

And I think, Guest, the simple reason people don’t absolutely demand equal pay for equal sacrifice – starting yesterday – in one loud voice – is that everyone’s been falsely convinced there just isn’t enough to go around if we demand pay justice.What a lie. What a murderous lie.It’s got to get through our heads that we’re afraid of giving up something that is killing us – the overpayunderpay dystem. We must learn to see the huge cost and waste caused by this dystem, that we would save if we abandoned it.We’d make ourselves richer in money and richer in happiness with pay justice.I have asked Santa to bring me the reason it hasn’t always been obvious – patently, tangibly, palpably, obnoxiously obvious to everyone.

Mother of God • December 23rd, 2008 at 7:59 pm

Cheers to Ya, OB – and to all o’ yiz Funderful Finnegans here, and to our good hosts, too, yes, with sincere thanks.This year, my favorite Christmas card says:May our hands that touch Mother Earth be a little gentler, and our hearts that care for her, and for ourselves, a little wiser.Keep well and have happiness, Everyone.

Mother of God • December 23rd, 2008 at 8:11 pm

Seriously, I’m going to have to screw up my nerve before I can go read that, Pete. I have from the start anticipated that military conflict will result from this already-nightmare. History says that is our trajectory.

Anonymous • December 23rd, 2008 at 9:04 pm

It’s funny, I just realized that an old friend of mine from high school and junior high who received her MBA through NYU around June of 2008 might have had Dr. Roubini as a professor. So, contacting her through a “sociat-site” which we both use, I (almost immediately) got this response (sans my name :) :”hey [my name,] yes, Nouriel Roubini was my professor, and we all found him amusing (and a little tiring) for his constant, continuous warnings/ discussions of impending disaster. Turns out he DID know what he was talking about… whoops.Anyway, miss you….come home someday, ok?”Well, judging from what my friend wrote, whatever misplaced faith 20-30-something year old NYU MBA students might’ve had in the alleged infallibility of American “free-market capitalism” has now likely ignominiously disappeared.Unlike Dr. Roubini, I’m no center-left Keynesian, but a socialist, though that’s another story altogether. (For the record, when I discussed political matters in the past with this friend of mine, her pronouncements/opinions were generally of a center-left character.)Besides all of this, I live in … The Republic of Moldova. Know anything about this country or not, it too is taking a hit from the crisis. The effects on the real economy — which, by all accounts, started to be felt around May, 2008 or so — definitely intensified around the beginning of this month and are certain to get worse in 2009.While, due to the rampant, uncontrolled money-lust of the ultra-rich finance capitalists in the US, American, Western European and Japanese workers are taking a huge hit which they can ill afford, most of Moldova’s population is already very poor by European standards and increased joblessness (already happening,) reductions in hours (already happening) and wage freezes (likely already happening) are a recipe for an absolute social catastrophe.

pa • December 23rd, 2008 at 9:05 pm

I think Dr. Roubini has helped demystify economics along with many people on this board.Average Jane, another demystifier you might enjoy are works by new zealand m.p.She is a member of the Board of the Reserve Bank of New Zealand. http://en.wikipedia.org/wiki/Marilyn_WaringShe has outspokenly criticised the concept of GDP, the economic measure that became a foundation of the United Nations System of National Accounts (UNSNA) following World War II. She ridicules a system which ‘counts oil spills and wars as contributors to economic growth, while child-rearing and housekeeping are deemed valueless’I read her book back in 1987 “If Women Counted “

Mother of God • December 23rd, 2008 at 10:00 pm

I just got this in my email from a dear friend in New Zealand. This guy, while raising two kids alone, re-claimed and improved land, farmed, butchered his own sheep and beef for his family, captained his own fishing boat for decades, pulling food from the sea to feed many people, helped research and start-up of the mussel-farming business in the Marlboro Sounds, owned and ran a cafe-cum-music-spot-cum only local grocery where we held poetry and local music jam nights, grew and sold organic produce, and ran his own excavating/digger business last I knew. He has built businesses, roads, houses, boats, and beautiful furniture, can fix ANYTHING, been active in local government, and is about the least complaining person I ever met. He just never could be stopped from helping all who came to him with need, and he laughs so easily. His letter is breaking my heart tonight, as is the letter from Moldova above.Hi *****, been a long time but I dont forget you easily,hope all is well with you in Obama land and the recession isnt biting too hard,I have been hit quite hard along with many others and have had to rethink a lot of my strategies.I am working for the establishment for the first time in nearly 40 years which I am not enjoying at all. not a matter of choice but necessity.I am working 12 hour days up at the coalmine driving a huge dump truck and I hate it, but at least the money is regular. physically very tiring and most of the time I am basically buggered. off to spend christmas with ***** (his children and new granddaughter).just wanted to wish you a merry christmas and good wishes for next yearhugs and love, Bob

Guest • December 23rd, 2008 at 10:15 pm

Nobody, in fact. They don’t want the evidence spilled or interfered with. SOP for this kind of investigation, despite whatever blatant political wishes you may have.

Dr. Crow • December 23rd, 2008 at 10:22 pm

Well you don’t expect to get paid a wage that could boost you out of debt, do you?! That kind of socialism would ruin the economy!!

Dr. Crow • December 23rd, 2008 at 10:26 pm

Gosh, I just knew they were a swell company to work for! Who could ask for a better xmas card from your employer of last resort?

RED • December 23rd, 2008 at 10:42 pm

PeteCA,Take this too the next logical conclusion. The US borrowed from foreigners when the dollar was high, thereby gaining maximum value of foreign funds. We will repay when the dollar is low, giving them back worthless dollars for the treasuries they purchased with the profits from their manufacturing activities.We Americans look pretty smart!!!Then when all foreign funds have been sold back to us on the cheap, we can raise interest rates and re-strengthen the dollar. It’ll take a couple of years, and American peasants will suffer, but the banksters will have made a killing.If you were a cynic, you might even think it was a good thing we have these banksters looking after us peasants. Otherwise we’d all be licking Chinese and Saudi boots by now.Cheers

redleg • December 23rd, 2008 at 10:47 pm

Only six? We should be so lucky. How many state, county, city layoffs are on the horizon? They are already happening in my neck of the woods. Can stimulus money be used by an entity in Chapter 9?

Average Jane • December 23rd, 2008 at 11:00 pm

jomos, the point of this is not that women should be, or are, “puttin’ more men outta work.” (Which implies to me that men deserve paid work more than women.) What would you have us do? Must we always get in line behind men before we are paid for our labor? And of course this begs the question of why the obverse remark is almost never heard–think about it: “. . . puttin’ more WOMEN outta work. . . .”All humans need productive work to do, and since the “system” is set up to reward that work with the coin of the day, whomever has the “gold” makes the rules.I do not wish to turn this into a feminist rant, though I am a feminist, if one must have a label attached to these remarks. What I am talking about is fair pay for all, in the macro sense, for labor. And Mother of God has fleshed out this argument much more eloquently than I.We wage earners, male, female and in between, have been and will continue to take body blows from those who do not earn their money but manipulate our hard earned dollars for their gain. And there’s nothing fair about that. I daresay the Masters of the Financial Fraud Universe have done a lot more to force men outta work than have the universe of minimum-wage-earning women.We are all struggling, jomos. And I have read many of your posts on this blog and respect you and your thoughts. I hope you accept mine in the spirit in which they are written.

redleg • December 23rd, 2008 at 11:02 pm

Look at the bright side of a global war (no, not the flash burst of an atomic weapon): it will cull the human herd, and will eventually bring in huge profits as whole civilizations will need to be rebuilt from smoking ruins!(sarcasm alert)

Average Jane • December 23rd, 2008 at 11:10 pm

pa, I’ve heard of this book and never got ’round to reading it. Thank you for the recommendation and the link–I shall certainly do some reading.

Guest • December 24th, 2008 at 12:02 am

“And I think, Guest, the simple reason people don’t absolutely demand equal pay for equal sacrifice – starting yesterday – in one loud voice – is that everyone’s been falsely convinced there just isn’t enough to go around if we demand pay justice.”This really blows my mind I can’t believe they’ve brain washed an entire society into thinking that if they pay people a self-sustaining wage our society will collapse, that doing this would take away the incentive to work hard and whatever other kind of boloney or excuse they can think of to not pay while the billionaires pillage our community.

artichoke • December 24th, 2008 at 12:09 am

This comments starts me to thinking that maybe it will happen, I can see the need for it. The USA will not permit its resource-rich and less-indebted neighbors to join competing blocs, so (by military force if necessary) we would pull them into the Amero.Before this it all seemed like idle speculation but now I see the possible mechanism behind it. The militarily strong forces on each major continent conquer it, forcing their neighbors into union, offering whatever terms make it work best.

Guest • December 24th, 2008 at 12:25 am

But the capitalists said they were going to save you from socialism but what they meant instead was that they were going to use you lie to you and steal from you. It’s funny how the great “capitalism” never really takes a great foot hold in these foreign places. It takes many years bla bla bla.

artichoke • December 24th, 2008 at 12:33 am

But does it make sense for Illinois to have a semi-functioning government all the while it takes the Federales to develop their case?

Anonymous • December 24th, 2008 at 12:35 am

It would help if they would just send the H1B’s back where they came from. Then would be jobs for our own children and ourselves.

Guest • December 24th, 2008 at 12:41 am

This may be true, I’ve never been to Africa. All the places I have lived, women have at least an equal shot at a job. My experience is that they have been preferred and given advantages overall, but that’s in the USA.Now that may be different elsewhere and at different times. Even in the USA I think that a lot of the layoffs are of women, for whatever reason.The problems in Africa are primarily for Africans to solve. I am all in favor of helping, but not in favor of meddling, in other people’s countries. For example, programs that fund women, but not men, to set up small businesses are blatantly discriminatory. These are used in many societies to change established social relationships. We should help everyone, in a mutually beneficial way, not just one gender or the other.

Guest • December 24th, 2008 at 12:48 am

Are they really suicides? These people are not known for being especially hard on themselves, as a group. They excel in being hard on others.Someone lost money in Madoff’s funds, blamed the intermediary, and went for payback — this scenario is easier for me to understand.A banker in London was found stripped totally naked, hanging in a closet from a belt. Would he really strip himself before killing himself? That would seem unlikely.

artichoke • December 24th, 2008 at 12:53 am

We Americans are returning to our ancestral memories, what we learned from parents or grandparents, about the GD, how to live simply and squeeze a nickel til it screams. We learned about it in school. “American thrift” is not an oxymoron, it’s a classic American value. It’s been a buried memory but it is coming out now, and nothing but rampant inflation would force people to spend now.So I guess rampant inflation is what we’ll get. They must force spending, those who love the economy. And we need inflation or the debts are unpayable.

Guest • December 24th, 2008 at 2:45 am

and now its going to take even longer, ha ha ha…actually sad. But the economy was not the only lies coming from our beloved capitalists US and UK. Another one was about the Iraq war…started because these two capitalist nations (that now are pulling everyone else downhill) wanted to play World Messiah.In fact the official story of 9-11 is not any example of some honest accounting either. Not to mention all the different Ponzi- and other schemes that various people, corporations, and the government in US have engaged in so as to suck money from whom-ever…blah.

Guest • December 24th, 2008 at 2:51 am

hey there is a lot of optimism here. Actually the situation is as bad as (or a tad worse) than during the Great Depression but yet most news are about that no it’s not quite as bad. No no. Absolutely not. By no means.

Guest • December 24th, 2008 at 2:53 am

A banker in London was found stripped totally naked, hanging in a closet from a belt. Would he really strip himself before killing himself? That would seem unlikely.

That is what I thought also. Perhaps he was on psychedelic drugs? Or he was killed by someone else. In which case maybe he had found out something about something? Who knows. Weird story.

Little Saver • December 24th, 2008 at 3:27 am

My wish for next year: a Nouriel Roubini column where he signs off with Dr. Boom.Not really expecting it for next year already.

Wild Bill • December 24th, 2008 at 4:02 am

Dear Economicminor,As promised, I have returned somewhat refreshed. Your condemnation of the current population you observe is entirely understandable. Shallow, self-involved individuals with no social conscience and no resistance to expediency when tested for moral fiber, seem to be all around us. We see people everywhere who seem to be lulled into a robotic mental state by materialism and hedonism, with no capacity for self-examination and self-awareness, much less the ability to shoulder the responsibility for their actions. These are not the individuals I would choose to start a revolution either, nor would I want them watching my back in a fox hole.What we are really discussing here is freedom. At this point I could start throwing out quotes from Thomas Jefferson or Isaiah Berlin but I can explain myself better if I simply use the phrase “…the pursuit of happiness.” I mean this to be the drive inherent in all of us, to completely fulfill the potential we are born with. If we could quantify the force of this drive and plot it on a graph, I would be very surprised if it did not describe a bell curve. At the extremes of the curve, we would find some who are very complacent and represent a child-like need to place their fate in the hands of others. At the other extreme, we would find those who are so driven in their extreme desire for self-actualization, that they become sociopathic. In between these extremes we would find a predictable continuity of drive force along the curve.There is no social animal ever studied that doesn’t have a hierarchy. Sometimes this hierarchy is rigid as in social insects or naked mole rats. Sometimes a little less so but still relatively inflexible, as in primates like baboons and bonobos, where dominant females influence the status of their offspring. Sometimes, there is every chance that the genetic lottery will produce an individual so superior, that it will be able to overcome any hierarchical structure and immediately rise to the top of the dominance ladder. To illustrate, I will use the artificial, partially controlled evolution of the horse.Horses can be easily classed as hot blooded (Arabians and Thoroughbreds), and cold blooded (draft horses, etc.). The underlying mechanism is the presence or lack thereof, of wild genes. The best race horses come from families that are stakes winners or stakes producers. Every once in a while, a horse from a lesser background will produce a super animal that will rise to the top of the hierarchy. ( eg.Seattle Slew, John Henry).What is most interesting, is the speed at which horses will revert to a wild state when artificial selection is removed. Domestication is the selective removal of wild genes. It must be constantly reinforced or reversion will occur. The same can be seen in swine and other animals that have become feral. These are the facts that can be applied to humans as well. To deny this will keep us in peril.We can argue that society is increasingly domesticating humans and encouraging them to keep themselves in a juvenile dependent state. These are the people you observe who “couldn’t find their asses with both hands”. When social conditions fail to reinforce this dependency state, these same people will revert and become quite capable of the revolutionary actions you believe they are incapable of right now.It is also interesting to observe what happens to animals that are denied their wild heritage. Survival behaviors are transformed into self-destructive ones. Wolves will endlessly pace in their cages. Tigers will cease grooming by licking themselves, and will bite themselves instead. Intelligent primates will suffer depression and reduced immunity. Humans given no options for self actualization, will resort to substance abuse, intra-specific violence, suicide and other aberrant behavior. Young men, who are given no other options, will give themselves over to organizations that train them to kill or they will increasingly kill themselves.So, with all this as background (I apologize for the long post), I have seen individuals who can be placed at all points along the previously described bell curve, in terms of their drive in the pursuit of happiness. They will come to the fore according to the extant environmental conditions. Some will become sociopathic. Some will become survivalists. I liken them to cancer cells that are going off on their own with no inhibitions from the organism they reside in. Some will use their talents and personalities to provide leadership to change the non-nurturing social structure. They may be evil (Hitler, Stalin) or benevolent (Gandhi, MLK, Mandella).To briefly summarize, you can never be sure where the next revolutionary personalities will emerge from, but you can be certain they will emerge when the conditions warrant. Freedom is in fact, equivalent to life force.

Wild Bill • December 24th, 2008 at 4:47 am

Dear Mother of God,Thank you for being you. You have my heartfelt good wishes during this holiday season and on into the future. After reading your excellent posts I would like to make the following observations. The first is that it is a man’s world and to compete in it, women have to become more like men to be as successful. I submit that for most women, this would be to their detriment. On the other hand, maintaining the status quo is also to their detriment. My personal preference is that women maintain all the wonderful things they are, and men learn to value those things more highly. In short, we must change the game so that success is measured by criteria that are more life enhancing and equitable.It is well established that sexual dimorphism is a function of how dangerous the environment is. Secondary sexual characteristics such as longer canines, bigger size and more aggressive behavior are all more prominent in animals living in harsh, dangerous environments. Often, the danger is from con-specifics, with infanticide and aggression against females, along with male expendability being the rule. Humans that show the least behavioral sexual dimorphism are those that live in areas no one else want to live in, such as the Kalahari Bushmen, the Inuit and the Andaman Islanders. So it seems for us, the greatest danger is from each other, not harsh environments or fierce predators.As well stated in “Women Who Run with the Wolves”, plans for development of primitive agricultural economies, all require women in pivotal roles as care givers, seed preservers, and other nurturing aspects of the economy. This requires that in order to be successful, women must have access to education and reproductive control. It is also interesting to note, that once women gain some measure of economic security without dependency on men, they tend to divorce every four years. This was documented in Helen Fisher’s “The Four Year Itch”. This fact is probably very disconcerting and threatening to men. It fosters the need to keep women dependent and dominated.I have been married forty-six years. I wonder if this would be possible if women were able to achieve true economic justice. I doubt it. On the other hand, even if it is too late for me, the prospect of sexual freedom with low levels of aggression and every child considered valuable regardless of who fathered it is a nice scenario to contemplate. It brings me back to my hippie days where we saw a brief window of what life could be like if there was true gender equality.

FAMC • December 24th, 2008 at 5:40 am

All:Merry Christmas and prosperous 201_ .Thank you Nouriel Roubini for opening your EconomicMonitor.Many “gurus” went in the opposite direction turning their marketcommentaries into a paid service. (Faber, for example and “Capital Multiplier” that was a free service and will become a paid service next year). Prechter’s ElliottWave is a paid service and do not have freeweek anymore, only ClubEWI with poor content. Also Prechter was wrong several times.Also, some free pseudo-newsletter I receive were wrong, wrong, wrong and the guys insist that you follow their advice as they know how to invest. They show only his gains. As Max Gunther wrote in the Zurich Axioms, for you to be known in this job, forecast, forecast, forecast… and never speak about your mistakes, only about your successesAt least in this site we can analyse Roubini’s analysis.Concerning gurus:Excerpt from “The Cost of Advice from Gurus”The Times of IndiaERNIE AKRIM”Creating financial clairvoyants has become something of a pastime for the financial media. Nearly every year, if not every month, investors learn about a new financial genius whose vision can safely lead believers through confusing financial markets, varying economic signals, and even demographic changes. In short, stock market gurus are market timers – witha special visionary gift.So who are these prophets? Should you place your future in their hands? Financial gurus come from diverse backgrounds. What they generally have in common is some correct financial market predictions and a dynamic personality. They also seldom maintain their guru status for long. However, because of increased media coverage, celebrity marketprognosticators are becoming harder to ignore today, and the temptation to follow their advice can be great.Investors should understand that they significantly increase their risk when they follow advice from a market guru. They might do dramatically better than expected, or they might do dramatically worse. And, if history is any indication, just because aprognosticator has been labelled a guru doesn’t increase an investor’s chances of succeeding.”—————————-Happy New-New YearFAMC

jomos • December 24th, 2008 at 8:07 am

This link below has the 200 year Gold/Dow ratio. A note: the expanding megaphone seen in this chart was also seen before the ’29 event.

jomos • December 24th, 2008 at 8:14 am

“The great Austrian School Economist, Ludwig von Mises wrote, ‘There is no means of avoiding the final collapse of a boom brought about by credit expansion. The question is only whether the crisis should come sooner as a result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved.’ There has never been any attempt to abandon the credit expansion. Indeed any crisis was simply an excuse to open the monetary spigots. This, then, is the beginning of the total catastrophe of the American dollar, indeed the entire world monetary and financial structure.”

jomos • December 24th, 2008 at 8:34 am

That’s true but think of it like a revolving credit line. A credit card allows debt to increase. And as long as your can make a minimum payment, you satisfy your creditors’ obligation. But would the creditor want to keep on increasing your credit limit based on solely your ability to pay the minimum ? Suppose you first double, than triple the original credit limit at some point the risk the creditor is willing to take might be flagged. Especially, if the creditor became aware of a decrease in salary of the debtor. Ask the people around the world today,if their creditors are adjusting for the risk in loaning credit to debtors. Well, if this is true for individuals many times over, ultimately it is true for states and countries. Agree ?

Hayes • December 24th, 2008 at 8:53 am

How is whatching SSO any different from watching SPX? Waz the big mistery?Hide reply Reply to this comment By Octavio Richetta on 2008-12-23 14:26:45You will find it can trade against the average it mimicks so it actully can give you heads-up on significant trend changes.Reply to this comment By CM on 2008-12-23 15:04:10____Hey CM – that suggests that one could trade IVV or SPY whilst watching SSO – Does that make sense?

Guest • December 24th, 2008 at 9:02 am

True but what worries me the most or I should say angers me the most was how credit was used to conceal falling wages and what would have been falling demand. By inflating the credit system the rich successfully robbed or tricked us out of our jobs and wages.There’s no doubt excessive credit favors the wealthy but only in the short run, ultimately their short sighted greed causes a collapse of the entire system.

painter • December 24th, 2008 at 9:17 am

i am in shock “The first is that it is a man’s world and to compete in it, women have to become more like men to be as successful. I submit that for most women, this would be to their detriment. On the other hand, maintaining the status quo is also to their detriment. My personal preference is that women maintain all the wonderful things they are, and men learn to value those things more highly” so many smart people on here but to say it is a mans world is the same as saying “give me a million dollars even if 10 children die from hunger. I am sure others will say what i can not about this mans world thing.

Canadian • December 24th, 2008 at 9:32 am

Fair play would be very nice; I’m not holding my breath though.One example – a millionaire gets a ticket for speeding and pays a fine amounting to perhaps one-one-hundredth of his weekly income, a minimum-wage earner get’s caught for the same offence and gets the same fine which amounts to one-half his weekly income. Not much fairness there. BTW – I agree women, in general are much lower paid than men in the same occupations and are not represented in management or in government to anywhere near the extent which they should, but the working poor, male or female, are very badly used by by the system.

Guest • December 24th, 2008 at 9:34 am

It’s funny but lovingness and compassion, characteristics I would generally attribute to women slightly more than men are still largely viewed in our society as a weakness, both women and men are programmed to view them as weaknesses. Right now society holds up high our most dominate corporations the ones that pay their workers the least and view them as hero’s of capitalism, crusaders for the free. The irony is the opposite is true, arrogance, the need to dominate, and prideful thinking is mostly weak and unfortunately those seem to be the traits we look for in our political and business leaders(pres. Bush etc.) If there’s good to come out of this catastrophe it’s that society is awakening to the fact that the failing status-quo is in fact weak.

PeteCA • December 24th, 2008 at 9:34 am

First, best wishes for a joyful and safe Christmas season to everyone here on this blog. For those who are Jewish, a happy Hannukah to you.I have a couple of links to some interesting articles.First, a really great set of charts from Mat Simmons’ company on the situation with oil prices at the current time. He is expounding at length on a subject I have mentioned here – that the current low prices for oil will create major problems with oil supplies in the future. Please note also his important comments that the futures markets for oil prices are no longer serving a sound economic purpose. When oil is priced too high or too low, the cyclic swings are causing improper reactions in the global economy. Here are the charts:http://www.321energy.com/editorials/simmons/simmons122408/simmons122408.html#Go to the link above and click “Launch Slide Show”. It is well worth taking the time to go through all 45 slides.————————————Here is anotherr link on some comments that appeared in the AsiaTimes about the US debt. This article is basically saying that the USA has an exploding debt problem, and a major debt default cannot be ignored in the future.http://www.asianews.it/index.php?l=en&art=14054PeteCA

aerial view • December 24th, 2008 at 9:37 am

We must have a universal, straightforward, transparent, honest accounting system to have any hope of not continually falling prey to the never ending evil financial schemes perpetrated by some of the smartest (yet unethical) minds that this country produces!

ALA • December 24th, 2008 at 9:47 am

It’s as though any amount paid in wages would bring you to a level that you would not demand more and more. Even if you were to be paid a figure you think would justify your worth would those who pay your wages agree that you were worth that amount. If you were to hire 500 people and 100 of those were not worth the wage paid to them would it be fair to the other 400. Those who outperform those around them are favored by those who pay their wages, do you recommend the others be paid the same as those who outperform. The self starter is the one who is followed by others of their own free will, Should those that follow demand a wage based on their assumption of their own worth, or be paid according to their abilities. They either accept the wages offered by the self starter or they themselves become a self starter thus allowing them to pay any wage they choose to those they hire. Even this would not satisfy everyone as many would say, we are not being paid a fair wage. You complain when you could compete, you ask for more based own the opinion of your own self worth. I would say America is not the best choice of countries to live and work for many as it rewards the self starter and achievers. Start your own business and compete paying any amount you think is fair to those you hire, don’t complain, act, compete, and lead by example. Complainers -to express discontent or unhappiness about a situation. Self Starters- somebody with the initiative and motivation to work without needing help or supervision.

Guest • December 24th, 2008 at 9:50 am

It’s funny how the capitalists who unearthed every possible way to suppress wages for the past 20 years(including easy loans to cloak their theft) now under desperate need for wage appreciation in the absence of credit attempt to villanize inflation- oh god do anything but actually pay people. What we really need to do is go door to door demanding our money from the rotten rich who stole it!!

MA • December 24th, 2008 at 9:52 am

Just my opinion… but I feel that clairvoyance comes from maintaining objectivity.No one is perfect. Surely not me, but I like to think that my hard work, good sense/feel, background, and creative analysis, coupled with my market neutrality has helped me guide people more accurately then those who may have different self serving agendas.My “advice” continues to be free, …and hopefully will continue to be just as accurate.All the best. Miss America

Guest • December 24th, 2008 at 9:57 am

humansare dividedinto differentclans and tribes,and belong tocountries and towns.but, i find myselfa stranger toall communitiesand belong tono settlement.the universe ismy countryand the human familyis my tribeunknow author?

PeteCA • December 24th, 2008 at 9:57 am

Possible US Crisis Coming?As a follow-up, I’d like to post a few comments that fall into the category of “food for thought”. The implications here are serious. In fact, considered not posting this before Christmas. But time marches on. Anyway, please realize that this is just theorizing and it could be completely wrong.To understand the train of thought, let’s look at a remark recently posted by Peter Nabvarro in one of his commentaries.———-Peter Navarro: “More broadly, it continues to puzzle me as to what goes on in the head of Ben Bernanke. For a Princeton professor, he seems just flat out stupid. All he has accomplished in his tenure in office has been to help wreck the financial system and almost single-handedly debase the currency.”———-and the full link is here:http://www.financialsense.com/editorials/navarro/2008/1222.htmlNow my comments.Let’s consider an alternative viewpoint.This is only a viewpoint.While it’s perfectly rational for all of us to rant and rave about the behavior of Mr Bernanke, Mr Paulson, and the US Government – we also have to consider a different explanation. Regardless of the political background of these men, they are not fools. So why would the American Government have taken the steps that it has in recent months? Let’s look at those steps:1. The Fed has provided a financial backup to many of the essential banks and services in the USA (incl, banking, home mortgage, and insurance). These Fed actions have been taken even if it means the Fed prints enormous quanitities of money, and makes future obligations in excess of 8 trillion dollars. An incredibly huge commitment.2. Mr Obama has announced a plan to provide emergency employment to one million people, and very recently he has expanded that idea to providing employment to 3 million people.3. Rumors that the US Gov’t is looking at deploying troops within the USA to quell dissent have become more substantial, as several news articles have now mentioned re-assignments of US forces for duties in America. The planned deployments go well beyond a normal response to a terrorist incident.4. Prices of oil and gold have dropped to very low levels, compared to their peak values in the last 12 months. The possibility of market manipulation cannot be fully ruled out as part of this process.My point is this …All these steps could be interpreted as a series of concerted actions where the US Gov’t is preparing the country for some sort of major crisis. No-one in gov’t has expounded on what type of crisis is contemplated … it could be economic, political or military. But clearly if a crisis is expected, then it must be pretty major in its possible extent.I find it interesting that our incoming VP (Biden) remarked very briefly before the elections “Don’t be surprised if the next President faces a major challenge within a few months of being elected”. He did not elaborate.I find it even more interesting that Mr Obama, after having been briefed at a high level by the White House, seems to be expanding his plans to cope with major unemployment and disruption of the US economy.You will have to draw your own conclusions. This article only represents speculation or theory, and the train of thought could be completely wrong. These speculations are not intended for investment purposes.PeteCA

Average Jane • December 24th, 2008 at 10:49 am

Wow. Extremely well put, Wild Bill. (I reiterate: Wild Bill for President.)The concept of “learned helplessness” fits well here too, I think.

Guest • December 24th, 2008 at 10:53 am

Yea I wasn’t exactly trying to pit men and women against each other or define concrete lines, my point was that at least on the surface women do seem to embody the the spirit of compassion and passivity a little more than men do and as a society we greatly undervalue those virtues. Women may find a greater role maybe leadership role going forward. This is not to say I identify with either male or female I agree the universe knows no gender, it’s just to say that some of our greatest strengths and potential are being under valued, under utilized. The continued perception that women are weak in the work force and leadership roles imo should change.

Average Jane • December 24th, 2008 at 10:55 am

PeteCA, your brain just never shuts off and you continue to do a massive amount of work to keep many of us on this blog informed. And you make us think. Bless you a thousand times and a happy holiday season to you and yours.

MM CA • December 24th, 2008 at 11:21 am

Pete – Happy holidays to you and yours! Waht part of Cali are you in? Amazing how we think alike, but you express it better….

CM • December 24th, 2008 at 11:43 am

Last minute goose-job underway…gotta have a green close for at least some kind of joyous respit! Merry Christmas/Happy Holiday’s to everyone. Thanks for a great year Nouriel

blindman • December 24th, 2008 at 11:51 am

Research NewsBlind Man Sees With Subconscious Eyeby Joe PalcaListen Now [3 min 57 sec] add to playlist.http://www.npr.org/templates/story/story.php?storyId=98590831.Joe Palca, Kathleen Masterson/NPRWatch A Video Of The Experiment.watch now|addMorning Edition, December 23, 2008 · Scientists are reporting the remarkable case of a blind man who can see.The case involves a middle-aged male physician living in Switzerland, who is known only by the initials “TN.” A few years ago, TN had two strokes, one on either side of his brain. The strokes severely damaged the part of the brain primarily responsible for vision, known as the occipital cortex.Extensive testing of TN confirmed that even though his eyes were just fine, he was completely blind. He couldn’t see objects held in front of him and used a cane to get around. Ask him if he could see, and TN would reply, “No, I’m blind.”But neuroscientist Beatrice de Gelder wanted to study TN further. She is affiliated with Tilburg University in the Netherlands as well as Massachusetts General Hospital in Boston. First, she and her colleagues repeated tests on TN to satisfy themselves that he was indeed blind.Then they laid out an obstacle course in a hallway. The obstacles consisted of everyday objects.”One was a typical paper basket; one was a stack of books,” says de Gelder. “They all had different shapes and sizes.”She then told TN to walk down the hall.”We didn’t give him information about obstacles or anything. So he was not aware that there were obstacles.”So TN walked down the hall, but instead of walking straight ahead, he carefully stepped around each of the obstacles.”He never touched any of it. We were like totally amazed,” says de Gelder, who reports her finding in the journal Current Biology. You can see this test by clicking on the video link above.For his part, TN was surprised that the scientists were surprised.”Since he had not seen any object, he wasn’t aware of having achieved anything sensational,” de Gelder says.TN has what is known as blind sight, according to de Gelder. Even though the primary part of his brain that processes visual information is destroyed, he still has more primitive parts of his brain intact, and these are capable of doing some visual processing. After all, one of the most basic functions of the visual system is to help an animal avoid obstacles or predators. TN still has some visual abilities — he’s just not aware he has them.Steven Hackley, an associate professor of psychological sciences, says studying patients such as TN will tell scientists about the nature of consciousness.”The idea is that by comparing the same mental process when it is conscious and when it is not, it will be possible to determine which parts of the brain are essential and how consciousness arises,” Hackley says…so, again, there is reason enough for hope.

tutterfrut • December 24th, 2008 at 11:53 am

18:53 local timeAppetizers prepared by the misses and daughter.’Witlof cream soup’on the stove.’Foie gras’(duck liver) ready to be slightly pan fried.Wood fire ready in garden to grill ‘magret de canard’(duck breast) two hours from now.Waiting for parents.Wish all my Roubini friends a very merry Christmess, er Christmas.P.S.: Our septic tank is running over, but we’ll just see it as an appropriate sign of this era. :)

Guest • December 24th, 2008 at 11:53 am

See what govt manipulations gets you!Benchmark 30-year rate falls to lowest level in the 37 years for which Freddie Mac has kept tabs — down a full percentage point in a year.

Hayes • December 24th, 2008 at 1:00 pm

Feb. (2007) Retail Sales Better Than Expected

NEW YORK Feb. 9, 2007 (AP)– The nation’s retailers finally got their sales boost in January, as shoppers redeeming holiday gift cards… link

Retail Sales in U.S. Rose 0.9% in January

Feb. 14, 2007 (Bloomberg) — Retail sales in the U.S. rose in January by the most in six months as Americans bought more cars and cashed in gift cards they got for the holidays, according to a survey of economists before a government report today. link

____________________December (2008) – Holiday Shoppers Shun Gift Cards on Closing Concerns (Update1)

Dec. 24. 2008 (Bloomberg) — William Smith won’t be stuffing anyone’s Christmas stocking with store gift cards this year.“With the credit crunch, we don’t know if they’ll be in business in the next couple of months,” said Smith, 34, a risk-management analyst at an energy company in New York. link

I suspect that the retail carnage in the January February period will be worse than many are expecting as accounting for gift cards is triggered not when they are sold but when they are redeemed.time to go and shovel snow Merry Xmas/Seasons Greetings to all RGE readers, posters and administrators – thanks for this excellent board.

Guest • December 24th, 2008 at 1:52 pm

US & Foreign Troop Domestic Operation Traininghttp://www.youtube.com/watch?v=iXifdr-LvHoClinton says it’s OK to have these troops in the USAhttp://www.youtube.com/watch?v=SFPsHPKY0y8

Guest • December 24th, 2008 at 3:19 pm

http://redgreenandblue.org/2008/12/23/coal-slurry-disaster-in-tennessee-is-largest-ever/.Coal Slurry Disaster in Tennessee is Largest EverWritten by Taylor SheltonPublished on December 23rd, 2008…….”On Monday morning Dec. 22 around 1:00 am, the earthen retaining wall around this mountain of coal ash failed and approximately 500 million gallons of nasty black coal ash flowed into tributaries of the Tennessee River – the water supply for Chattanooga TN and millions of people living downstream in Alabama, Tennessee and Kentucky.Despite the magnitude of this disaster, it continued to fly under the radar of most media outlets until the last few hours.”….. cm.?.http://archive.wbai.org/files/mp3/081224_090001dn.MP3

MBSQuestions • December 26th, 2008 at 8:14 am

question about mortgage backed securities (mbs) in mutual fund.1> i have checked many mutual funds with mbs, it seems they have not mark down their mbs holding. anyone knows why? and they continue to rate their mbs holding AAA? especially FNMA, GNMA, FHLB mbs.2> as mortgage default start to climb, mbs value should go down right? how come i am not seeing the mark to market phenomenon in mutual fund holds mbs? should i avoid mutual fund with mbs?3> as mortgage default start to climb, the borrowing cost (risk premium) should go up. But are we seeing that happening, as Fed is lowering the borrowing cost by pushing the long-term rate down to 0%?4> is mbs still toxic? have mbs being properly mark to market?

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Formula One plans to raise about $450M by selling new shares as part of $3B IPO in Singapore http://t.co/m9Nc1qKM
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Edward Hugh Don't Shoot the Messenger

Edward is a macro economist, who specializes in growth and productivity theory, demographic processes and their impact on macro performance, and the underlying dynamics of migration flows. Edward is based in Barcelona, and is currently engaged in research on aging, longevity, fertility and migration, and the impact of all of these on economic growth.

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