Nouriel Roubini's Global EconoMonitor

RGE’s Weekly Roundup

Check out all of the RGE analysis and EconoMonitor contributions that were published this past week at

RGE Analysis:

Comparing 2010 Growth Forecasts for Major Economies by Rachel Ziemba, Elisa Parisi-Capone, Christian Menegatti, Arpitha Bykere, Bertrand Delgado and Mikka Pineda [Available to RGE Clients Only]

The Greece Dilemma: Sovereign Debts Imperiling the Euro and Challenging EU Ties by Arnab Das, Elisa Parisi-Capone and Natalia Gurushina [Available to RGE Clients Only]

Housing Starts: No Reason to Expect a Strong Recovery in 2010 by Prajakta Bhide [Available to RGE Clients Only]


On Nouriel Roubini’s Global EconoMonitor, Nouriel analyzes the tricky business of fiscal stimulus as advanced economies wrestle with swollen fiscal deficits and public debt, fueling concerns over sovereign risk.  Please read The Risky Rich.


On the RGE Analyst’s EconoMonitor, Kavitha Cherian, Mikko Forss, Mary Stokes, and Jelena Vukotic examine the political risk in four countries that seem at particular risk of having their IMF programs derailed by politics: Iceland, Latvia, Romania and Ukraine.  Please read IMF Loan Programs in Europe Run into Political Obstacles.

In China’s Reserves: The Challenges of US$2.4 Trillion, Rachel Ziemba expects diversification attempts to pick up in 2010, but with the exchange rate pegged,  China faces diversification limitations on its allocation of national assets.


On the Finance & Markets Monitor, President Obama’s proposal for new banking limits spurred reaction.  Please read:

Please, Listen to the Man by Daniel Alpert

Why Obama is Now (finally) Getting Tough on Wall Street by Robert Reich

Obama to Propose Rules to Restrict Proprietary Trading by Yves Smith

Obama Proposes Volcker-Style Financial Reform by Mark Thoma

Also on the Finance & Markets Monitor:

Does Conventional Wisdom Miss the Boat on Banker Bonuses? by Rene Stulz

Why Banks Should Clean up their House and How they Can Take Advantage of the Opportunity of Modern Times by Carlo Resta

Breaking the Banks by Rick Bookstaber

Taxing Bailed-Out Financial Institutions by Mark Thoma


On the Peterson Institute for International Economics Monitor, Steve Weisman interviews Jeffrey J. Schott who says carefully targeted sanctions could impede Iran’s nuclear program and energy infrastructure, but they are unlikely to change Iranian leaders’ political agenda.  Please read Will Sanctions Against Iran Work This Time?


On the Global Macro EconoMonitor, Laura Freschi discusses important economic considerations when providing disaster relief.  See Too Much of a Good Thing? Making the Most of your Disaster Donations.

In EMH Funeral Oration, Satyajit Das expounds on where we stand in the debate on the Efficient Market Hypothesis.


On the U.S. EconoMonitor, Barry Ritholtz points out the subtle but critical difference in deciding whether to protect the banks or the banking system when crisis hits.  Read Who Bears the Costs of Post-Crisis Recovery?

In The Outlook for 2010: A Critique of Modern Monetary Policy, Joseph Mason recognizes that the recent era of managing the Fed funds rate to reduce the path and duration of business cycles is failing, and examines how monetary policy has evolved.

In Grading Obama’s Economic Policy after One Year, Edward Harrison gives the President a failing grade for not seeing the differences between 2010 and 1994.

Also on the U.S. EconoMonitor:

It’s Not about Interest Rates Yet by Tim Duy

Government Payroll across U.S. Presidencies by Rebecca Wilder

Bernanke’s Sorcery Will Fail by Arun Motianey

The Election of Scott Brown by James Picerno

Iran Will have the Bomb in 5 Years (Again) by Fabius Maximus

The Frequency of Economic Statistics Matters at Turning Points by Rebecca Wilder


On the Emerging Markets Monitor, Michael Pettis examines the numbers and argues they confirm his concerns about the quality of growth, which is still wholly investment driven, and as the inflation numbers came in higher than expected, Pettis suggests that we could see a move on the currency and interest rate tightening in the first quarter.  See Good Numbers? Or Bad Numbers.


On the Asia EconoMonitor, China Economist looks into the sustainability of impressive Chinese export numbers.  See Manipulation or Recovery.


On the Latin America EconoMonitor, Alejandro Schtulmann explores a series of political risk scenarios for Mexico based on various possibilities and the confluence of negative factors. The scenarios are outlined in the order of likelihood with the first one being more probable and the last one highly unlikely, although none of these risks should be dismissed.  See Mexico: Five Key Policital Risks in 2010.


On the Europe EconoMonitor, Edward Hugh examines the economic situation in Italy and Spain.  See Spain Gets Frobbed-Off by the EU Commission and The Italian Lion Sleeps Tonight, and Yet Awhile…….

In Bringing Stability to the Stability and Growth Pact, Models & Agents argues that safeguarding the “stability” objective of the Stability and Growth Pact (and the European Monetary Union more broadly) will take bold measures focusing on stricter and more effective rules and enforcement mechanisms.

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