Roubini: Washington must manage perceptions

Iconoclastic economist Nouriel Roubini says that is the key issue in walking a tightrope between continued recession, with even deflation worries, and inflation.

Roubini warns on double-dip and speculators

Nouriel Roubini warns a double-dip recession is possible, and also warns that commodities speculators are getting out of hand.

The second warning certainly applies to the US above all, followed by the UK. Ditto, I believe, on the first count. Germany and France are already out of recession; China appears to be headed that way.

Twould be funny indeed (ignoring the suffering value), if “old ‘socialistic’ Europe” recovered faster than the US or UK, the most hypercapitalist western nations.

Roubini sez re-appoint Bernanke; ugh

Well, Nouriel Roubini has been right about a lot of things related to the current recession, but not this one.

Sure, he possibly may have kept this recession from being worse; even then, was his solution the best? And, as Roubini notes, he helped get us here in the first place. In fact, he got enough wrong in 2006-08, what’s to say he won’t fuck up more if reappointed?

Of course, inside the “bipartisan economic policy establishment” that we have today, maybe you can’t find a better person to run the Fed than Ben Bernanke. Of course, that’s an indictment of the bipartisan economic policy establishment.

Roubini says recession could end this year

Now, Nouriel Roubini was spot-on about many of the causes leading up to the current recession. At the same time, he’s a definite contrarian at times. So, I’ll take his prediction with a grain of unemployment salt.

Double-dip recession?

Iconoclastic and sometimes contrarian economist Nouriel Roubini says it’s quite possible.

That said, Roubini’s comments remind me of a couple of things.

First, iconoclastic contrarians usually revel in the attention they get by being … well, iconoclastic contrarians. And, I think Roubini’s reveling in spades.

Second, it’s economist joke time.

How does a contrarian economist get 60 percent of his predictions right?

“Regular” economists only get 40 percent right, right? …

Well, do the math, you non-economists.

That said, any second dip is likely to be less severe than the first one.

Unless other factors come in.

See, I could be an economist!

Meet Obama’s economic Cassandras

Salon has a good set of thumbnail sketches of Paul Krugman, Nouriel Roubini and a dozen other economists and others who, from various economic and political points of view, question Obama’s economic program.

Unfortunately, Salon spoils a decent story by having Ron Paul and Michelle Bachman listed as the two elected politicians heading the opposition. WTF?

Is Nouriel Roubini OK with Geithner TALF plan? Ehh …

Josh Marshall at TPM marked him down for a cautious yes; let’s take a look at what Roubini says.

From where I sit, I would make that a very cautious, and very caveated, yes.

First, the OK:

With this plan, it will still be a hard swim, but, at least, there is a path to shore.

Next, the caveats:

The deal is structured so that firms will be responsible only for losses on their initial investment. The hope is that by giving this big "freebie," the government will induce investors to participate, and that competition among them will lead to higher offer prices for the loans and securities, thus encouraging banks to sell them.

A lot of ifs …

But let's not have any illusions. The government bears the risk if and when the investors take a bath on the taxpayer-provided loans. If the economy gets worse, it could get very ugly, very quickly. The administration should be transparent in making clear that there is still a wealth transfer taking place here - from taxpayers to investors and banks.

Italics mine, and very needed.

That last is the biggest caveat from where I sit.

It would be one thing to call for that level of transparency from “Abstract Treasury Secretary X.” it’s another thing entirely to expect it from real-world Treasury Secretary Tim Geithner.

Meanwhile, on the same NY Daily News online op-ed pages, Luigi Zingales zings the plan harshly. REALLY harshly:

The irony of the plan is that it seems to replicate the same excesses that brought the crisis - carrying enormous economic and political risk. …

If you think that the revelation of AIG lavish bonuses has shown all the rage of the American people, think again. When former subprime lenders will become the new billionaires, we run the risk of a populist revolution.

Only thing is, as Zingales knows, the idea of a “revolution” here in America? Chuck Norris’ third fist and half brain aside, not so much.