Interesting video from a show where money manager Hugh Hendry puts an economist in his place. Economists are like weathermen IMO. They can be completely wrong, but they can continue to make predictions and listened to so long as they get published, make tv appearances, or look like Paul Krugman. So it was fun to see Hendry, who is a volatile Scotsman, slam one to his face.
Most economists failed to understand the size and interconnectedness of the subprime credit mess. They also are not discussing the Alt-A and Neg-Am impending crisis, which is just as large. More importantly, they fail to see how the governments took on the debts of the banking sector, which now creates a sovereign debt crisis. These experts fail to see this is not a liquidity crisis. It is a solvency crisis.