Like most liberal garbage, he blames the financial crisis on lack of regulation. There is no mention of CRA and the sub prime mess the government created.
..."we’ve had a disastrous banking and financial crisis. That was in part due to poor regulation and supervision of financial institutions.
He goes on to say...
Roubini: I don’t believe in market discipline. It doesn’t work. That was the ideology of the last 10 years; self-regulation means no regulation.
while it is true liberal tend to run to the comfy “regulation” excuse, it is also true that the derivative market - the credit default swaps - amplified the mess that was fannie/freddie.
Maybe amplify isn’t the right word.
They multiplied that problem by a factor of, what? a trillion? a gazillion?
Sometimes there are good “regulations”, sometimes bad.
There is something very odd about the swaps market.
The more I read about them, the more they appear to be a form of insurance fraud.
Fraud is not “free market”
Fraud is fraud.
The subprime mess was indeed caused by poor regulation because the regulator was blocked by the Democrats who called the regulator racist. The statement that poor regulation resulted in the subprime crash is correct so far as it goes. It just doesn’t address the root cause, Government meddling in the housing market.
Like most liberal garbage, he blames the financial crisis on lack of regulation.
So, then, please explain to us how the exemption of credit default swaps from regulation in 2000 worked out so well. As well as exemption of new commodities exchanges from regulation.
Also, please note, he said 'in part' - not in whole.
Roubini was correctly calling the housing bubble back in 2004-5 when many who call themselves conservative were asserting a new normal under which housing prices could only go up.