Wake-Up Call to Economists: The Whole System Is Bankrupt, Put It in Bankruptcy
Jan. 20, 2009 (EIRNS)This release was issued today by the Lyndon LaRouche Political Action Committee (LPAC).
As the Wall Street stock markets greeted President Barack Obama with another steep plunge, New York economist Nouriel Roubini declared at a conference in Dubai, that the losses of the U.S. financial system will quickly rise to $3.6 trillion, and pronounced the whole banking system "effectively insolvent," having capital of only $1.4 trillion. The U.S. banking system as a whole is bankrupt, Roubini said, and the same is true for those of Europe.
True enoughbut then the contrarian economist drew the conclusion, that U.S. President Barack Obama will have to plan another $1 trillion bank bailout, above and beyond the second half of the $700 billion Troubled Asset Relief Program (TARP), just put through.
"You don't have to do this," responded U.S. economist and statesman Lyndon LaRouche, who forecast this financial system's bankruptcy. "It would be fraudulent. You've got a bankrupt system, and they refuse to put it into bankruptcy! What they are doing instead, is they are getting to an inflationary valuation of fraudulent assets. Here you have a bank that's bankrupt. The assets are worthless. Everybody agrees the assets are worthless. But they are going to try to keep them alive. What is that, but fraud?"