----------------------------------------- http://www.rgemonitor.com/roubini-monitor/255816/the_rising_risks_of_a_global_l-shaped_near_depression_and_stag-deflation
· massive and more unorthodox monetary policy easing to defrost credit markets even if this may imply central banks widening collateral and taking greater credit risk;
· massive and front-loaded fiscal stimulus more on the spending than tax side and with income relief to agents with high marginal propensity to spend (poor, unemployed, state/local governments);
· rapid takeover of insolvent banks – full nationalization - and their quick clean-up and re-privatization;
· across the board reduction of the face/principal value of mortgage debt and other consumer debt for insolvent households as a case-by-case debt re-stretching of debt will not work
· immediate doubling of the IMF resources and provision of loans/liquidity to emerging markets under liquidity and financial stress (with conditionality for those economies with severe macro/financial/policy weaknesses; with very light conditionality for the emerging markets with sounder fundamentals)
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Got all that? Here's the soundbite version: (1) nationalize the damn banks already; (2) spend like mad on workers; (3) massive debt relief for workers; (4) worker-friendly bailouts of the weaker semi-peripheral economies.
It's called socialism, of course. To reappropriate a slogan of The Enemy, there is no alternative!
-- DRR