Roubini On 2013's "Global Perfect Storm" And Greedy Bankers "Hanging In The Streets"

Tyler Durden's picture




 

In an extended interview with Bloomberg TV, Nouriel Roubini lives up to his doom-saying reputation and goes where few have as he opines on Lieborgate that: "bankers are greedy and have been for 1000 years" and "nothing is going to change" unless there are criminal sanctions; to which he follows up - briefly silencing the interviewer, "If some people end up in jail, maybe that will teach a lesson to somebody - or somebody will hang in the streets". The professor goes on to note that the EU "summit was a failure" since markets were expecting much more and warns that without full debt mutualization, debt monetization by the ECB, or a quadrupling of the EFSF/ESM 'bazooka'; Italian and Spanish spreads will continue to blow out day after day - leading to a crisis "not in six months but in two weeks". The only entity capable of stopping this is the ECB which needs to do outright unsterilized monetization in unlimited amounts which is 'politically incorrect' to talk about and claimed to be constitutionally illegal. 2013 will be a very difficult year to find shelter as policy-makers ability to kick-the-can runs out of steam as he sees the possibility of a 'Global Perfect Storm' of a euro-zone collapse, a US double-dip, a China & EM hard-landing, and a war in the Middle East. Dr. Doom is back.

Must watch 9 minutes of reality:

On Lieborgate:

Nothing has changed since the financial crisis. The incentives of the banks is to cheat - doing things that are either illegal or immoral. The only way to avoid that is to break up these financial supermarkets. There are no chinese walls and massive conflicts of interest.

On Greed:

Bankers are greedy - they have been for 1000 years.

On Sanctions:

There should be criminal sanctions. Noone has gone to jail since the global financial crisis. The banks do things that are illegal and at best they get a slapped with a fine. If some people end up in jail, maybe that will teach a lesson to somebody - or somebody will hang in the streets.

On TBTF banks:

There are more conflicts of interest today than four years ago. The banks that were too big to fail and now they are even bigger. Things are worse - not better.

On The EU Summit:

The summit was a failure. The markets were expecting much more.

Either you have debt mutualization (to reduce the spread), or you have debt monetization by the ECB, or the bazooka of the EFSF/ESM has to be quadrupled - otherwise the spreads on Italy and Spain are going to blow up day after day. Otherwise you will have another bigger crisis not in six months from now but in the next two weeks.

On The ECB saving the world:

The only entity capable of stopping this is the ECB which needs to do outright unsterilized monetization in unlimited amounts which is 'politically incorrect' to talk about and claimed to be constutionally illegal.

On Debt mutualization:

It is not just Germany that is resistant but other core nations including The Netherlands, Austria, and Finland. Finland doesn't even want to accept the recent indirect mutualization of the summit liabilities (of the EFSF/ESM).

On kicking the can:

By 2013, the ability of policy makers to kick the can down the road is going to run out of steam, and in the euro zone the slow motion train wreck will become a fast motion train wreck. The US seems close to stall-speed and an economic recession. The landing of China is becoming harder and EM nations (and BRICs) are sharply slowing down. And finally the potential for war between Israel, the US, and Iran - which will double oil prices overnight.

On 2013 being worse than 2008:

Worse because like 2008 you will have an economic and financial crisis but unlike 2008, you are running out of policy bullets. In 2008, you could cut rates; do QE1, QE2; you could do fiscal stimulus; you could backstop/ringfence/guarantee banks and everybody else. Today, more QEs are becoming less and less effective because the problems are of solvency not liquidity. Fiscal deficits are already so large and you cannot bail out the banks because 1) there is a political opposition to it; and 2) governments are near-insolvent - they cannot bailout themselves let alone their banks. The problem is that we are running out of policy rabbits to pull out of the hat!

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Sun, 07/08/2012 - 19:29 | 2597162 algol_dog
algol_dog's picture

I don't have kids, so is it ok if I want the can to be continually kicked down the road?

Personally, I think we need to wait for the greatest generation to be reincarnated again to fix this mess. Now those bad-asses knew how to fix things.

Sun, 07/08/2012 - 23:18 | 2597748 Seer
Seer's picture

Those "bad-asses" helped TPTB cement the System!  They helped create the State (which harbors financial, as well as other, terrorists).

Sun, 07/08/2012 - 21:47 | 2597554 unique_snowflake
unique_snowflake's picture

Peter Pan isn't in his sixties.  Just a guess.

Sun, 07/08/2012 - 18:49 | 2597070 Peter Pan
Peter Pan's picture

Unsterilised monetisation by the ECB?

So we are going to fix rubbish with more rubbish?

This is the man who prefers spam over gold and is too embarrassed to admit that gold is a major weapon in the arsenal.

Or is gold not an option because US repositories have nothing to hand back?

Sun, 07/08/2012 - 23:21 | 2597759 Seer
Seer's picture

He's an "economist!"  Fuck, people, the JOB of "economists" is to protect the System, to lie for it!

Until Roubini can demonstrate how we can achieve perpetual growth (he is ALWAYS talking about the need to return to growth, yet never says what that really means, let alone HOW) he's a stooge for TPTB.

Sun, 07/08/2012 - 18:51 | 2597073 Dr. Engali
Dr. Engali's picture

"Today, more QEs are becoming less and less effective because the problems are of solvency not liquidity."

No F&*#ing s@*t, most of us have been saying that for four f#*%ing years.

Sun, 07/08/2012 - 19:30 | 2597165 DeadFred
DeadFred's picture

I always enjoy reading his comments but be aware he is one of the better contraindicators out there. He's not up to Stolper's level but the MSM gives him and El Erian face time to gloom at the audience whenever the manipulators need the sheep to sell as they pull out a magic ramp job. I have no idea what they can possibly do to make this positive but history says that when Roubini glooms the S&P goes up.

Sun, 07/08/2012 - 23:31 | 2597781 Bananamerican
Bananamerican's picture

c'mon Fred, we're talking about Roubini here, not Snookie....

how many hits on that video?

Sun, 07/08/2012 - 18:51 | 2597076 The Watchman
The Watchman's picture

Bankers are greedy?????? Wow that is some deeeeep insight.

Sun, 07/08/2012 - 23:32 | 2597787 Bananamerican
Bananamerican's picture

He didn't say it like some revelation.

He said it matter of factly with a giant side order of ennui....

Sun, 07/08/2012 - 18:51 | 2597077 fonzannoon
fonzannoon's picture

Later this year every dangerous aspect of the "fiscal cliff" will be repealed or pushed off again into the future. We will celebrate how politicians were able to put aside their differences and come together to ensure that these dangers do not actually impact us. The credit rating agencies will say something about how "eventually the debt will have to be addressed but we applaud these measures towards economic growth and prosperity". The price of gold will once again be a "risk on" asset and not a "canary in a coal mine" but why buy gold when you can buy mega cap companies with dividend paying ability. This will go on longer than anyone around here believes possible.

Sun, 07/08/2012 - 18:58 | 2597094 Dr. Engali
Dr. Engali's picture

I don't think so,not this time. I think everything is coming to a head and it will be surprising if we make it to 2013.

Sun, 07/08/2012 - 19:02 | 2597114 fonzannoon
fonzannoon's picture

They have exposed the (LIBOR) manipulation of interest rates worldwide. If you told me that 4 years ago I would have told you it would lead to interest rates exploding all over the world. Today no one understands or even really cares. If the S&P gets nailed like BK thinks it might the 10yr will go to 1.25%. This stuff is happening in plain sight nowadays and it still goes on and on. You may be right but I think the "fiscal cliff" phrase was planted by CNBS to be blasted over and over and over so that when it is "avoided" markets will celebrate worldwide.

Sun, 07/08/2012 - 19:11 | 2597129 Dr. Engali
Dr. Engali's picture

I agree that the fraud is all out in the open but my opinion is that TPTB are allowing it all to be exposed to set up the next stage of the new world order The "fiscal cliff" is just another scare tactic.

Sun, 07/08/2012 - 19:38 | 2597187 DanDaley
DanDaley's picture

Another step toward martial law à la Obama's latest Executive Order giving him control over all communications in time of "emergency".  They are putting the final touches on the cake.

http://www.whitehouse.gov/the-press-office/2012/07/06/executive-order-as...

Sun, 07/08/2012 - 20:02 | 2597245 Questan1913
Questan1913's picture

"Another step toward martial law à la Obama's latest Executive Order giving him control over all communications in time of "emergency". They are putting the final touches on the cake."

Really well done!  I take it you have been tasked with sowing fear?

Sun, 07/08/2012 - 23:37 | 2597800 DanDaley
DanDaley's picture

What's your interpretation?  Obama would never do that?  

Sun, 07/08/2012 - 18:51 | 2597079 michaelsmith_9
michaelsmith_9's picture

According to fx, the AUDUSD suggests higher levels are ahead for the short-term and longer-term.  There could be a bearish interpretation, however, it has a much lower probability.  Therefore, with the AUDUSD looking higher, the S&Ps should push higher as well.  Here is a look at the full analysis:  http://bit.ly/LHzQJX.  There is still very much a downturn coming for the markets, but it is likely not until at least 2013.

Sun, 07/08/2012 - 19:02 | 2597109 Seasmoke
Seasmoke's picture

after reading this , i feel like giving you an up AND a down arrow

Sun, 07/08/2012 - 20:41 | 2597351 MeelionDollerBogus
MeelionDollerBogus's picture

yes, I see the correlation. 2 charts: (1) http://scharts.co/MTOH7R and (2) http://scharts.co/MTOTnJ

and here's brent and WTI oil together with the DOW 2012 05 03 oil vs dow | goldpricemodel

Certainly DOW and S&P move together.

In http://scharts.co/NgRLWm you can see the EUR/USD pairing actually moving with silver but it's a lot more clear in the shorter-term seeing this chart http://stockcharts.com/h-sc/ui?s=$XEU&p=D&yr=1&mn=7&dy=0&id=p23735169023 or short URL version http://scharts.co/MTP6al

What's sad is that all of this is data, easily proven, yet 4 ignorant people red-arrowed your comment.

Sun, 07/08/2012 - 19:53 | 2597092 Doode
Doode's picture

I just hope that this 2012 Mayan end of days now scheduled to 2012+1 will actually happen. So far the system has shown a remarkable ability to weather the storm. Greece was supposed to implode last year - at least 2 times, and it did not happen. So was the rest of the Europe as prescribed by Soros et al - I believe it was 2 weeks ago that the Europe was supposed to end. There is a proverb about false prophets in the Bible - perhaps everyone should just chill and heed that ancient wisdom. 

Mon, 07/09/2012 - 17:06 | 2599959 e-recep
e-recep's picture

the bible is a fairy tale. jesus never lived and god does not exist.

Sun, 07/08/2012 - 18:56 | 2597095 max2205
max2205's picture

I wish......

Sun, 07/08/2012 - 18:58 | 2597101 Benjamin Glutton
Benjamin Glutton's picture

Roubinispierre!!!

 

well said brother.

Sun, 07/08/2012 - 19:00 | 2597104 Seasmoke
Seasmoke's picture

i guess Roubini got tired of partying with the biatches

Sun, 07/08/2012 - 19:01 | 2597107 GOLDTEETHSILVER...
GOLDTEETHSILVERFILLINGS's picture

Are you lost? Follow the yellow brick road...

Sun, 07/08/2012 - 19:01 | 2597108 TahoeBilly2012
TahoeBilly2012's picture

What happens when Spanish/Italian bonds go to 10%? At what level does it become a self fulfilling collapse due to further capital flight? It seems like if the it repeats the Greek downfall then people now might act 2 to 3 times as quick getting out of Spanish bonds.

Sun, 07/08/2012 - 19:04 | 2597118 fonzannoon
fonzannoon's picture

It seems like they can go to 10% tomorrow. But the morning of an auction a major rumor gets released and pushes yields down to 5.5% and they get the auction off. Rinse, repeat.

Sun, 07/08/2012 - 19:22 | 2597155 bank guy in Brussels
bank guy in Brussels's picture

Some of us remember much higher bond rates, which somehow were manageable ...

1981 ... US 10-year Treasury note ... 15.84% yield ...

1981 ... US 30-year Treasury bond ... 15.25% yield ...

Now the US would explode at those rates.

So as Jim Sinclair says ... QE to infinity ... what is absolutely 'needed' by the bankers, will be provided.

Ben Bernanke can access black hedge funds in the Cayman Islands, give them electronically printed fiatscos, and the black hedge funds can buy bonds, in Europe or anywhere else. ... This can work longer than most people would imagine.

Sun, 07/08/2012 - 20:11 | 2597267 algol_dog
algol_dog's picture

The plan will be in operation until the last bear is ceremonially slaughtered on Bernanke's holy altar, and zero hedge throws in the towel and shuts down ...

Sun, 07/08/2012 - 19:02 | 2597110 EndTheMedia
Sun, 07/08/2012 - 19:06 | 2597120 newworldorder
newworldorder's picture

Well - This will have serious implications for his invitation to attend DAVOS as well as the Consulting Contracts from his clients.

You know what they say .... A banker scorned - and all that.

Sun, 07/08/2012 - 19:08 | 2597126 Zola
Zola's picture

I can see Roubini has been reading ZH...

Sun, 07/08/2012 - 19:09 | 2597127 Snakeeyes
Snakeeyes's picture

Bankers are greedy and Socialists are not????????

But I agree that there is a perfect storm brewing (no velocity, downturn in most economic indicators, etc).

It has NOTHING to do with LIBOR. It has EVERYTHING to do with massive taxation and government policies and regulations gone wild!

If you want to drink the LIBOR Kool-Aid, knock yourself out.

http://confoundedinterest.wordpress.com/2012/07/06/libor-fixing-and-the-fed-funds-target/

But LIBOR fixing has NOTHING to do with US employment malaise and tanking indicators.

http://confoundedinterest.wordpress.com/2012/07/06/summertime-blues-u6-unemployment-rises-to-14-9-nonfarm-payrolls-grow-only-80k/

If you are awake at 7am EST, I will be on The Mike Church Show on Patriot Radio (Sirius) discussing employment, Rouweenie and LIBOR.

Sun, 07/08/2012 - 19:20 | 2597150 A Lunatic
A Lunatic's picture

Then War it shall be........followed closely by starvation, disease, and a general refusal of Nature to continue to "just go along" with the machinations of evil men.

Sun, 07/08/2012 - 23:27 | 2597771 Seer
Seer's picture

Yikes!  When I constantly find myself in agreement with "A Lunatic" I suppose I should pause and reflect...  Reflect.  Reflect.  OK, done!  Spot on!

Sun, 07/08/2012 - 19:31 | 2597152 midgetrannyporn
midgetrannyporn's picture

He's nothing but a low-down, double-dealing, backstabbing, larcenous perverted worm! Hanging's too good for him. Burning's too good for him! He should be torn into little bitsy pieces and buried alive! [/hanover fiste] http://www.youtube.com/watch?v=tHgMsvpFm08&feature=related

Sun, 07/08/2012 - 19:21 | 2597153 Forgiven
Forgiven's picture

Get a rope!  It's time to hang these f&ckers

 

Sun, 07/08/2012 - 19:21 | 2597154 cherry picker
cherry picker's picture

The Mayans probably had a math genius working for them and calculating (((human nature/dna + dinero x quality of life) - satisfaction) x sexual freedom) x population explosion = 2012.

He or she was ahead of his or her time :)

Sun, 07/08/2012 - 23:29 | 2597772 Seer
Seer's picture

A perfect example of why I come here! (some of the best humor around!)

Sun, 07/08/2012 - 19:26 | 2597159 ebworthen
ebworthen's picture

"...unless there are criminal sanctions; to which he follows up - briefly silencing the interviewer, 'If some people end up in jail, maybe that will teach a lesson to somebody - or somebody will hang in the streets'"

Ahoy, Dr. Roubini; we have grog, hard tack, and rope.


Mon, 07/09/2012 - 02:19 | 2597980 northwind
northwind's picture

that was my thought, nothing has changed in 350 years since pirate days. the fight is still for the guns, the gold, and the whiskey. gor rope?

Sun, 07/08/2012 - 19:33 | 2597170 blindman
blindman's picture

is dr. doom an election year phenomena?

Sun, 07/08/2012 - 20:32 | 2597330 blindman
blindman's picture

i ask a question and get a down arrow. that tells
me one thing for certain, do you know what that is?

Sun, 07/08/2012 - 23:33 | 2597790 Seer
Seer's picture

If you look around you'll see that EVERYTHING has one or two down-arrows.  Trolls on the loose...

I think that you might be right.  Seems that Roubini has been kind of hidden away.  Looks like he's trying to garner a little interest (that's what got me going to his site, then he stated some really STUPID stuff so I left) while still playing the System's side (Ctl Print).  He's got too much stink on him, it'll never wear off: clearly he's still trying to rub up against the biggest stinkers- MSM.

Sun, 07/08/2012 - 19:33 | 2597173 Irelevant
Irelevant's picture

Fuck this clown! He sais all that the money masters tell him to say.

Sun, 07/08/2012 - 19:34 | 2597175 monopoly
monopoly's picture

The important part all is not what he is telling us. We know all of the above. We have been educated here for a long time on what is coming down the pike. What makes this important is that people listen to this man. He is of course telling the truth and repeating it again and again, but he is closer to the mainstream then us here at Zero Hedge. Not the idiot channel or MSN news, but many that follow the "other news". I find it disconcerting that the dollar continues to rally as the "one eyed blind man" leading the blind. But Europe continues to move closer to the cliff and is first up. So even gold, silver, short term can get hit. Does not change my stash at all. 

You know we will be getting close to an event when Tom Keene on Bloomberg, who I respect, asks Tyler Durden to do an uncensored interview with him......And Tyler accepts! THAT will be TV worth watching, finally.

Sun, 07/08/2012 - 23:36 | 2597798 Seer
Seer's picture

A "one eyed blind man" is clearly blind.  I prefer: "best looking horse at the glue factory."  It has all the appearances of being capable and going far, but, context...

Sun, 07/08/2012 - 19:42 | 2597199 rosiescenario
rosiescenario's picture

Ever the optimist, Dr. Roubini failed to mention that all of his financial end of days visions will pale against that provid ed by Mother Nature as the world's population gets a major culling this fall thanks to a newly mutated form of H1N5 which freely spreads from host to host in the air.

Sun, 07/08/2012 - 20:07 | 2597255 Questan1913
Questan1913's picture

So I guess he's an impostor?  You are the real Doctor Doom?

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