Nouriel Roubini Oct 3, 2008
It is now clear that the US financial system - and now even the system of financing of the corporate sector - is now in cardiac arrest and at a risk of a systemic financial meltdown. I don’t use these words lightly but at this point we have reached the final 12th step of my February paper on “The Risk of a Systemic Financial Meltdown: 12 Steps to a Financial Disaster” (Step 9 or the collapse of the major broker dealers has already widely occurred).
Yesterday Thursday a senior market practitioner in a major financial institution wrote to me the following:
Situation Report: So far as I can tell by working the telephones this morning:
LIBOR bid only, no offer. Commercial paper market shut down, little trading and no issuance. Corporations have no access to long or short term credit markets -- hence they face massive rollover problems. Brokers are increasingly not dealing with each other. Even the inter-bank market is ceasing up.
Read on...
This Roubini article is very scary reading. Peacenik doesn't think doomsday is funny. Roubini thinks today may be doomsday. Peacenik is looking forward to the weekend. Have a good one.
It is now clear that the US financial system - and now even the system of financing of the corporate sector - is now in cardiac arrest and at a risk of a systemic financial meltdown. I don’t use these words lightly but at this point we have reached the final 12th step of my February paper on “The Risk of a Systemic Financial Meltdown: 12 Steps to a Financial Disaster” (Step 9 or the collapse of the major broker dealers has already widely occurred).
Yesterday Thursday a senior market practitioner in a major financial institution wrote to me the following:
Situation Report: So far as I can tell by working the telephones this morning:
LIBOR bid only, no offer. Commercial paper market shut down, little trading and no issuance. Corporations have no access to long or short term credit markets -- hence they face massive rollover problems. Brokers are increasingly not dealing with each other. Even the inter-bank market is ceasing up.
Read on...
This Roubini article is very scary reading. Peacenik doesn't think doomsday is funny. Roubini thinks today may be doomsday. Peacenik is looking forward to the weekend. Have a good one.
