Nouriel Roubini, NYU prof, famous for his accuracy, predicts utter collapse and closing of markets in wake of crashing hedge funds.
"Oct. 23 (Bloomberg) -- Hundreds of hedge funds will fail and policy makers may need to shut financial markets for a week or more as the crisis forces investors to dump assets, New York University Professor Nouriel Roubini said.
We've reached a situation of sheer panic,'' Roubini, who predicted the financial crisis in 2006, said at a conference in London today.There will be massive dumping of assets,'' and
hundreds of hedge funds are going to go bust,'' he said.
Group of Seven policy makers have stopped short of market suspensions to stem the crisis after the U.S. pledged on Oct. 14 to invest about $125 billion in nine banks and the Federal Reserve led a global coordinated move to cut interest rates on Oct. 8. Emmanuel Roman, co-chief executive officer at GLG Partners Inc., said today that as many as 30 percent of hedge funds will close.
Systemic risk has become bigger and bigger,'' Roubini said at the Hedge 2008 conference.We're seeing the beginning of a run on a big chunk of the hedge funds,'' and
don't be surprised if policy makers need to close down markets for a week or two in coming days,'' he said.
Roubini predicted in July 2006 that the U.S. would enter an economic recession. In February this year, he forecast a
catastrophic'' financial meltdown that central bankers would fail to prevent, leading to the bankruptcy of large banks exposed to mortgages and asharp drop'' in equities."
When someone like this speaks, we should listen. Couple this with an Obama-Reid-Pelosi government...