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The real Cassandra of the crisis

Business Times - 24 Oct 2009


The real Cassandra of the crisis

Lawyer Brooksley Born had warned that the completely unregulated and unobserved trade in derivatives could bring down the entire financial system

By LEON HADAR
WASHINGTON CORRESPONDENT

MOST of those who follow economic news are familiar by now with the name of Nouriel Roubini, an economics professor at New York University's Stern School of Business, who was one of the few economists who had predicted the financial crisis more than three years ago.

In a speech at the International Monetary Fund (IMF), he warned of an impending collapse of the global financial system and a deep recession.

But there was apparently another Cassandra, who unlike Roubini hasn't been transformed into an instant celebrity, but who more than 10 years ago had not only warned that the completely unregulated and unobserved trade in financial derivatives could bring down the entire financial system, but who also had the guts to stand up to then Fe…