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Q&A with Nouriel Roubini

In mid-July, world renowned economist Nouriel Roubini sat down with Chronicle.SU’s Anton OyVey for a fireside chat at Bohemian Grove 2011. They discussed the next 18 months of world events, including the Debt Crisis and stock market crash. Much of the discussion was deemed “off the record” by Nouriel, but after a little arm twisting he agreed to sign off on the release of the following excerpt.

Anton: Thanks for the rim job earlier in Kissinger’s tent.

Nouriel: It was my pleasure. Great to share life, love and good wine with you again.

Anton: Stop it.

Nouriel: Did you see what Mohamed A. El-Erian got me?

Anton: Yes and that’s not where it was meant to be inserted.

Nouriel: (laughs)

Anton: Seriously tho… I want to talk a little bit about the next year in world events. Word around the Grove is the Debt Crisis is going to be center stage and you are going to be a busy bee over the next year. Is Doctor Doom about to go viral again?

Nouriel: Let’s just say my calendar is booked solid for the next 18 months, but I will still make time for good wine and cheap women.

Anton: Ben Bernanke’s cabana boy told me that Quantitative Easing Three (QE3) is on it’s way and you are going to be a big proponent again. Do you really believe QE3 will be effective in stimulating growth or should the Federal Reserve be taking another approach?

Nouriel: Economic growth in the US and most developed economies is anaemic at best. Measures of inflation, both core and headline, are below the implicit and explicit targets of the Federal Reserve. The scenario has been and will always be low growth, low inflation and an unemployment rate close to 10 per cent. If you run the numbers, you get that the Fed Funds rate should be around minus 5 percent, but nominal policy rates have a zero lower bound.

Quantitative Easing by the US and other governments has been increasing liquidity to effectively push the real policy rate below zero. Some $600bn of additional liquidity in QE2 was the equivalent of a reduction of about 50-60 basis points in the FFR. When Ben Bernanke says this is just a variant of traditional monetary policy, I think that is correct, even if unconventional. But we both know how Ben likes to stay on top of things…

Anton: (laughs)

Nouriel: I love good wine.

Anton: There’s been a healthy buzz at the Grove about next month’s market crash. Is now a good time to short equities?

Nouriel: Absolutely. The Dow Jones will drop over nine thousand points over the course of several months, starting in August. As you know, global investors have concluded that Obama will only be a one term president and have shifted resources to the GOP. No surprise about Governor Perry. He has an amazing dimple on his ass by the way.

Anton: You are such a pervert.

Nouriel: I can afford to be. I’m Doctor Doom damn it! (grabs wine bottle) More wine?

Anton: No thanks. So what kind of recovery can we expect?

Nouriel: We are looking at an unprecedented recovery pattern. I initially thought we were looking at a “U” shape recovery. After further analysis, it seemed a “W” recovering was in order. But not so fast. The Eurozone and Asian markets have a lot of say in this too. That’s why I’m predicting a “WVW” reccovery. That’s a quintuple dip recession for those scoring at home. More wine?

Anton: No. I’m not drinking.

Nouriel: I told Charlie Rose I’d meet him in Donald Sutherland’s tent in 5 minutes. You coming?

Anton: No. I need to rest my corn hole.

Nouriel: Pussy.

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President Obama Trolls The Press: Opens Speech With Minute Of Unexplained Silence

President Obama took to the podium today to talk to Americans about the White House’s initiatives to help veterans get back into the work force and what the government is doing to encourage a healthy economy. But before he dove into the details, the President stood at his podium for a good minute or so in silence, interrupting only to let the audience know that he was “just waiting, here.”

After the speech the President told reporters “Gotcha! Hahahaha… U MAD?” Obama explained that it was a prank that was improvised on his own and no staffers had prior knowledge. “It’s been three years now that I’ve been doing these boring prepackaged speeches. I thought I’d mix it up a little bit. For the lulz, of course!”

After a minute of awkward silence and the audience waiting expectantly for the President to say something, a man in the audience took matters into his own hands and shouted “shapeshifter!” at the President.

A few seconds later, President Obama began his speech without incident, boring the balls off everyone in the room as per usual.

OBAMA TROLLS [VIDEO]

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Obama Signs Debt Limit Compromise

President Obama signed off on a last-minute compromise bill to ensure economic catastrophe Tuesday, saying the deal is an “important first step to ensuring that our nation end up in the recycle bin of history with USSSR and Red China.”

The bill, he said, was the outcome of a “extensive strap-on session with both Harry Reid and John Boehner on the Oval Office desk” to ensure an economic disaster which will make the Great Depression look like a picnic. He said that while voters actually believe they have a representational government, “they are in for a big surprise, America as you know it, is over baby!”

“A lot of folks worked long hours to get us into this economic catastrophe, they deserve a little credit here too,” the president said as he winked into a television news camera. He added: “Our economy didn’t need Washington to come along with a manufactured crisis to make things worse, but we did it anyway. We run this.”

After making remarks at the White House, Mr. Obama had unprotected sex with House and Senate leaders in a closed-door ceremony Tuesday to celebrate. In a statement, House Speaker John Boehner commented that the new bill “made me jizz in my pants. I love men.”

Now that the debt limit fight is effectively over, Congressional Democrats say they will pivot back to pretending to care about jobs and the economy.

The President seemed to support that sentiment. “We should do everything in our power to grow this economy and put Americans back to work, but we won’t because Jamie Dimon, Lloyd Blankfein, and Vikram Pandit have my balls in a vice grip.” Mr. Obama said Tuesday.

“This means making some adjustments to dismantle health care programs like Medicare so they aren’t there for future generations. It also means reforming our tax code so that the wealthiest Americans and biggest corporations never have to pay their fair share,” he said.

“And it means increasing taxpayer subsidies to oil and gas companies and tax loopholes that help billionaires pay a lower tax rate than teachers and nurses. Welcome to Junkyard America baby!”