Roubini : In The Eurozone the problem is also the amounts of debt in the private sector and the banks

Thursday, January 20, 2011

Roubini : In The Eurozone the problem is also the amounts of debt in the private sector and the banks

Nouriel Roubini :"...Well, my fear has been that unfortunately in the case of the eurozone and a number of insolvent or nearly insolvent countries in it, their problems may just not be of liquidity but also the amounts of debt in the private sector and the banks.
The robust backstopping of the financial systems by the governments has made them near-insolvent . So, provision of liquidity might not be sufficient. At some point down, there might be coercive restructuring of public debt of countries like Greece and Ireland.
And unfortunately, problems are now spreading to Portugal, possibly Spain and other parts of the eurozone. There is also problem of competitiveness. And now, restoring of not only large stocks of public debt but also private liabilities owned by organizations. ..."
via www.economictimes.indiatimes.com

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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.

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Thursday, January 20, 2011