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Roubini Predicts U.S. Losses May Reach $3.6 Trillion

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seemslikeadream Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jan-21-09 03:59 PM
Original message
Roubini Predicts U.S. Losses May Reach $3.6 Trillion
http://www.bloomberg.com/apps/news?pid=20601087&sid=aS0...

By Henry Meyer and Ayesha Daya

Jan. 20 (Bloomberg) -- U.S. financial losses from the credit crisis may reach $3.6 trillion, suggesting the banking system is effectively insolvent, said New York University Professor Nouriel Roubini, who predicted last years economic crisis.

Ive found that credit losses could peak at a level of $3.6 trillion for U.S. institutions, half of them by banks and broker dealers, Roubini said at a conference in Dubai today. If thats true, it means the U.S. banking system is effectively insolvent because it starts with a capital of $1.4 trillion. This is a systemic banking crisis.

Losses and writedowns at financial companies worldwide have risen to more than $1 trillion since the U.S. subprime mortgage market collapsed in 2007, according to data compiled by Bloomberg.

President Barack Obama will have to use as much as $1 trillion of public funds to shore up the capitalization of the banking sector, following the $350 billion injection by the Bush administration, Roubini told Bloomberg News. Congress last year approved a $700 billion rescue fund, of which half remains to be disbursed.

Bank of America Corp., the largest U.S. bank by assets, posted a quarterly loss of $1.79 billion last week, its first since 1991, and received $138 billion in emergency government funds. Citigroup Inc. posted an $8.29 billion fourth-quarter loss, completing its worst year, and plans to split in two under Chief Executive Officer Vikram Pandits plan to rebuild a capital base eroded by the credit crisis.

Bankrupt System
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BeHereNow Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jan-21-09 04:03 PM
Response to Original message
1. K&R!!!!!!! Grassfed posted an EXCELLENT video from another consultant in PV today too- must see.
Here:
http://www.democraticunderground.com/discuss/duboard.ph...

The smoke and mirrors are about to clear and the dam WILL break.
BHN
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seemslikeadream Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jan-21-09 04:05 PM
Response to Reply #1
4. Can we say nationalized banks?
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BeHereNow Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jan-21-09 04:08 PM
Response to Reply #4
6. Indeed... on edit-
Edited on Wed Jan-21-09 04:10 PM by BeHereNow
Did you watch C-Span today?
Griether confirmation hearing?

I couldn't watch after about ten minutes.
The farce continues.

BHN

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leftstreet Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jan-21-09 04:04 PM
Response to Original message
2. How's that Capitalism workin' out?
K&R
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FourScore Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jan-21-09 04:05 PM
Response to Original message
3. Roubini knows his stuff.
k/r
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BeHereNow Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jan-21-09 04:06 PM
Response to Reply #3
5. Check out the video link from my post above- related.
Grassfed put it up in PV today.
Also, be sure to visit the Economy forum.
GREAT stuff there from Joanne.

BHN
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FourScore Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jan-21-09 07:33 PM
Response to Reply #5
10. I'll do that! Thanks. n/t
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Romulox Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jan-21-09 04:08 PM
Response to Original message
7. I say we give the banks another $350 B, no strings attached. Problem solved! nt
Edited on Wed Jan-21-09 04:09 PM by Romulox
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robinlynne Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jan-21-09 04:47 PM
Response to Original message
8. Well, there's 3 trilion "missing" in the pentagon. That should take care of most of it.
Let's have that 3 trillion back please.
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leveymg Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jan-21-09 05:46 PM
Response to Reply #8
9. Anyone want to guess whose mattress a lot of it ended up in?
Edited on Wed Jan-21-09 05:47 PM by leveymg
Here's a clue:



Let's just call it, S&L Rip-off II - The Big One.

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robertpaulsen Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jan-21-09 07:38 PM
Response to Original message
11. K & R! Roubini's been a very accurate forecaster.
:kick:

:hi:
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