Monday, February 3, 2014

Roubini : 'Fragile Five' face low risk of full-fledged crisis

The Fragile Five Emerging Economies are : India, Indonesia, Brazil, Turkey and South Africa  
Roubini : "All have flexible exchange rates, a large war chest of reserves to shield against a run on their currencies and banks and fewer currency mismatches (for example, heavy foreign-currency borrowing to finance investment in local-currency assets)," Roubini, nicknamed Dr. Doom for his generally bearish views, wrote in an op-ed on the Project Syndicate website on Friday. "Many also have sounder banking systems, while their public and private debt ratios, though rising, are still low, with little risk of insolvency," he said. "The short-run policy tradeoffs that many of these countries face - damned if they tighten monetary and fiscal policy fast enough, and damned if they do not - remain ugly," he said.

Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics
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