| Roach: "I've been a pessimist for three years and it's depressing" |
Who says economists are dull? Three of Wall Street's finest, and most bearish, took part in an early-morning debate about the impact of the Iraq war on the US economy at the Council for Foreign Relations in New York last month. At times it was like stand-up comedy, with Morgan Stanley chief economist Stephen Roach as the main act.
Asked about the possibility of deflation, he replied: "Well, I was the first jerk to mention the D-word 14 months ago. I got a call from the Federal Reserve. I used to work there years ago, and they said that they were disappointed in me, and that they expected more from one of their illustrious alumni." Then, after a pause: "I exaggerate, of course. They called me a crackpot and an embarrassment." You don't expect an economist to draw a laugh, at least not on purpose, but the crowd loved it. And it wasn't even 9am.
But it wasn't his first crack. A few minutes earlier Bill Dudley, chief US economist at Goldman Sachs, was talking about a lack of corporate spending in the US.