Thursday, April 18, 2013

Roubini takes on Yellen, a clash for the ages

Chamberlain vs. Russell.  Magic vs. Bird. Gibson vs. Eckersley, and now Roubini vs. Yellen. Sometimes it takes one great competitor to bring out the best of another.

In a moment of magic at an otherwise dense IMF discussion of post-financial-crisis monetary policy, Nouriel Roubini, known for his pessimistic outlook and aversion to economic policymakers, procured a microphone and asked Fed Vice Chair Janet Yellen if, maybe, just maybe, she was all wrong about the looming threat of asset bubbles.
Roubini had in mind Yellen’s earlier prepared remarks to the panel that she didn’t see any clear and present danger of an asset bubble and her conclusion that bank regulatory policy was the best flame retardant to combat any overheated markets.

He slyly noted that other top Fed officials, notably the new whiz kid of the Fed board, Jeremy Stein, have raised some doubts that  regulatory policy is the best way to burst a bubble.
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