EconomicCrisis.US

The US economy faces a difficult time ahead as consumers stop spending and the fallout escalates from the collapse of the commercial real estate market, economist Nouriel Roubini told CNBC.

Repeating his prediction that the economy faces a threat of a “double-dip” recession and at best a slow-growth U-shaped recovery, Roubini said in a live interview that more banks will fail and residential real estate prices have more room to decline.

Additionally, non-government bonds will face pressure, the securitization market is all but dead, the credit markets are still frozen and consumers will continue to save more rather than spend and boost growth.
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Monday marks the one-year anniversary of a frightful day that changed economic history. On Sept. 7, 2008, the federal government stunned financial markets by announcing its takeover of two mortgage giants, Fannie Mae and Freddie Mac.

That was just the beginning. In ensuing days, Bank of America took over Merrill Lynch; Lehman Brothers collapsed; credit markets froze up, and insurance giant AIG grabbed at an $85 billion federal rescue.

In a new series, “Financial Crisis: One Year and Counting,” NPR examines the wild events and the efforts of the Federal Reserve, Treasury and Congress to avert an economic catastrophe. The series will count up the costs of both the crisis and the cure. Preview stories in the series:
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The U.S. Federal Reserve asked a federal judge not to enforce her order that it reveal the names of the banks that have participated in its emergency lending programs and the sums they received, saying such disclosure would threaten the companies and the economy.

The central bank filed its request on Wednesday, two days after Chief Judge Loretta Preska of the U.S. District Court in Manhattan ruled in favor of Bloomberg News, which had sought information under the federal Freedom of Information Act.

Preska said the Fed failed to show that revealing the names would stigmatize the banks and result in “imminent competitive harm.” The Fed asked the judge not to require disclosure while it readies an appeal.
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So it seems that we aren’t going to have a second Great Depression after all. What saved us? The answer, basically, is Big Government.

Just to be clear: the economic situation remains terrible, indeed worse than almost anyone thought possible not long ago. The nation has lost 6.7 million jobs since the recession began. Once you take into account the need to find employment for a growing working-age population, we’re probably around nine million jobs short of where we should be.

And the job market still hasn’t turned around — that slight dip in the measured unemployment rate last month was probably a statistical fluke. We haven’t yet reached the point at which things are actually improving; for now, all we have to celebrate are indications that things are getting worse more slowly.
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