Nouriel Roubini on The subprime mortgage Crisis | NOURIEL ROUBINI BLOG

Sunday, November 7, 2010

Nouriel Roubini on The subprime mortgage Crisis

NOURIEL ROUBINI:".... Unfortunately, I think we're going to have a very severe recession. It's going to last at least 18 months through the middle of next year. And this financial crisis is not going to be over anytime soon.

And the problems are not just problems of housing. Housing has not yet bottomed out. Home prices are going to fall for another 15 percent for a cumulative fall of 40 percent.

The problem was not just subprime mortgage. It was subprime mortgages, near-prime mortgages, prime mortgages, credit cards, auto loans, student loans, commercial real estate, muni bonds, leverage loans that finance deals that should have never occurred, and even a fat tail of the corporate system as a huge amount of junk bond debt is borderline unprofitable and is going to get in trouble.

We have the biggest housing and asset bubble and credit bubble in U.S. history. Now it's going to burst, and many institutions, households, home-builders, financial institutions, and corporations are going to go bust..."
Nouriel Roubini interviewed by PBS Newshour

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Nouriel Roubini, (born March 29, 1958, Istanbul, Turkey), Turkish-born American economist and educator who was best known for predicting the 2007–08 subprime mortgage crisis in the United States and the subsequent global financial crisis.

Born to Iranian Jewish parents, Roubini moved with his family to Iran and Israel before they settled in Italy in 1962. After a year at Hebrew University of Jerusalem, he studied economics at Bocconi University in Milan (B.A., 1982) and Harvard University (Ph.D., 1988), where he specialized in macroeconomics and international economics. He joined the economics faculty at Yale University in 1988 and taught there until 1995, when he moved to New York University. He also served as a visiting scholar to the International Monetary Fund (IMF), was a research associate with the National Bureau of Economic Research (NBER), held single-year terms on the White House Council of Economic Advisers (1998–99) and at the U.S. Department of the Treasury (1999–2000), and cofounded (2004) the consulting firm Roubini Global Economics. Roubini spent much of his early career studying countries that experienced extreme economic failures, such as Mexico (in 1994), Thailand and other countries associated with the 1997 Asian financial crisis, Russia (1998), and Argentina (2000). He determined that each shared one common element: a massive current account deficit.(www.britannica.com)

Nouriel Roubini is the Chairman and CEO of Roubini Macro Associates, LLC, his own global macroeconomic consultancy firm. He is also a professor of economics at New York University’s Stern School of Business. Dr. Roubini has extensive policy experience as well as broad academic credentials. From 1998 to 2000, he served as the senior economist for international affairs on the White House Council of Economic Advisors and then the senior advisor to the undersecretary for international affairs at the U.S. Treasury Department, helping to resolve the Asian and global financial crises, among other issues. The International Monetary Fund, the World Bank and numerous other prominent public and private institutions have drawn upon his consulting expertise.