Nouriel Roubini’s Worries About Another Financial Crash Aren’t Crazy

Sumary of Nouriel Roubini’s Worries About Another Financial Crash Aren’t Crazy:

• EMILE WAMSTEKER/BLOOMBERG Watching Bill Hwang Archegos Capital Management hedge fund stumble triggers more traumatic memories than global finance veterans like to admit..
• For many, parallels between the 1998 blowup of Long-Term Capital Management and Hwang forced liquidation of more than $20 billion worth of stocks on March 26 were too strong for comfort..
• The details differ, but the underlying forces—heavily leveraged positions colliding with the hubristic belief that past crises can’t happen again—are essentially the same..
• Sadly, Roubini seems to be on to something as he warns ultralow to negative borrowing costs across the developed world and epic fiscal laxity pushed risk-taking into the stratosphere..
• In 2012, the alumnus of Julian Robertson Tiger Management hedge fund was essentially blacklisted after pleading guilty for insider trading..
• Last month reckoning put a spotlight on global banks that started dealing with Hwang again, seduced by lucrative trading commissions….

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From Forbes - 09/04/2021