Monday, May 12, 2008

Stuart Thomson – Chief economist at Resolution Asset Managemen – “we are still within the Minsky moment”

Path to recovery may hold surprises

The Federal Reserve's rescue of Bear Stearns in March represents an important milestone in the credit crunch, but it does not mark the beginning of the end of the crisis. Financial distress and the failure of a major American institution has been a feature of every post-War recession. The central bank rescue is an important gauge of the authorities' understanding of the financial problems, and provides several innovative channels to increase market liquidity. But it leaves plenty of surprises before the crisis is eventually resolved.

Posted by jack c @ 07:30 PM (597 views)
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One thought on “Stuart Thomson – Chief economist at Resolution Asset Managemen – “we are still within the Minsky moment”

  • Opening Doors Finance says:

    Robert Shiller (Yale Uni professor) has been predicting a significant downturn in global house prices since 2004. Whilst working on a trading floor, I recall watching an interview he did on Bloomberg where he was quite pointed in his views that the housing bubble was global (and not just US-based) and that “contagion” would occur.

    I know it’s easy to say that if you keep predicting something for long enough then at some point you’re bound to be correct! However, Shiller’s ability to look at the fundamentals and what is ACTUALLY happening (rather than what we BELIEVE is taking place) is a wake-up call to us all; especially those of us with mortgages. At some point, sensibleness had to be restored to both lenders and borrowers alike.

    (“On a mission to help UK homeowners save £10 million on their mortgages by Dec 2011.”)

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