Roubini: Another Nasty Crisis; Forget Subprime, Look At Prime. Another 8M Having Negative Equity

Nouriel Roubini was speaking in Cape Town today. He commented on housing prices in the U.S, and Japan's fate.

“If house prices are going to fall another 5 to 10 per cent, another 8 million households are going to be in negative equity,”

“We are going to have another nasty crisis. That’s going to happen unless we do something about it. Forget about subprime, look at prime.”

“The next year is going to see a painful process of deleveraging, both in the private and public sector, lower consumption, lower spending, lower budget deficits, more savings, reduction of debt," "That implies an anemic economic recovery.”

Japan's is

"[...] accident waiting to happen." "The economy has not done the structural reform needed even after 15 years of near depression and politically there is a total stalemate,"