Tag Archives: forecasting

US of AA+

Rarely has a rating agency’s rating of a single country been met with such anticipation and followed by so much commentary. On August 5, Standard & Poor’s downgraded US long-term sovereign debt from the maximum of “AAA” to “AA+” adding an “Outlook Negative” to the picture. As mentioned all over the press, this is the first time to happen. What is particularly interesting about the downgrade is the motivation. Surely, United States has a huge public debt—of a size that causes even the most Keynesian-minded economists to take it seriously. But the motivation is barely economic at all. As seen in “Research Update: United States of America Long-Term Rating Lowered … Continue reading

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“Dr. Doom” or “Mr. Lucky”?

A colleague of mine recently directed my attention to this interesting article from the January 9 edition of the Boston Globe: “That guy who called the big one? Don’t listen to him.” In the article, journalist Joe Keohane describes the now well-known 2006 prophecies made by Nouriel Roubini of New York University about an upcoming major financial crisis (he is described as, at that time, a “somewhat obscure economist“, which is extremely inaccurate I should say!). Due to his precise forecast about the crisis, which indeed began the year after, and took on an unprecedented world-wide scale in 2008, Roubini became a man to be taken really seriously. He apparently … Continue reading

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