[lbo-talk] Roubini: Worst Financial Crisis Since the Great Depression and Worst U.S. Recession in Decades

Doug Henwood dhenwood at panix.com
Wed Jul 16 14:30:49 PDT 2008


On Jul 16, 2008, at 5:18 PM, Ira Glazer quoted Roubini:


> * This will be the most severe U.S. recession in decades with the
> U.S. consumer being on the ropes and faltering big time
> <http://www.rgemonitor.com/roubini-monitor/252869/
> the_delusional_complacency_that_the_worst_is_behind_us_is_rapidly_melt
> ing_awayand_the_risk_of_another_run_against_systemically_important_bro
> ker_dealers>
> as soon as the temporary effect of the tax rebates will fade out
> by mid-summer (July). This U.S. consumer is shopped out, saving
> less, debt burdened and being hammered by falling home prices,
> falling equity prices, falling jobs and incomes, rising inflation
> and rising oil and energy prices. This will be a long, ugly and
> nasty U-shaped recession lasting 12 to 18 months, not the mild 6
> month V-shaped recession that the delusional consensus expects.

Again, maybe so, but there's no evidence that this is happening yet.

It will be very interesting if the oil bubble bursts, too. That will reduce inflationary pressure, and also lighten the burden on spending.

Doug



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