John Ryskamp

The Promise and Peril of Comprehensive Deposit Insurance

The problem with Roubini now is that we have reached the limit of his analysis.

He says that no value can be assigned. However, at the same time, he seeks intervention based on some value: guaranteeing bank deposits, recapitalizing banks and so on. Those suggestions proceed on the assumption that value can be assigned.

This is a contradiction. What it means in his own terms is that he has shifted from an economic analysis to a political analysis. This raises the question, what are his political assumptions?

It also means that you have to watch out, from now on, regarding his predictions. Actually, he is underestimating the problem. Things will collapse much more quickly than he is predicting.

Does he have a strongman candidate waiting in the wings? Is he plotting an 18 Brumaire?