'Doctor Doom' Nouriel Roubini spells weekend meltdown for Credit Suisse

New Delhi: Renowned economist Nouriel Roubini, nicknamed as Wall Street’s ‘Doctor Doom’, has warned of a possibility of Credit Suisse going bust over the weekend if European Central Bank hikes rate by 50 basis points. In a tweet, Roubini said: “If European Central Bank (ECB) hikes [rate] by 50bps (basis points) it is possible that CS (Credit Suisse) goes bust over the weekend and then the ECB has to reverse itself by next week.” The economist further said that he hopes ECB will “not repeat the mistake made in 2011 during the EZ (Euro Zone) crisis when it hiked into that crisis.” “ECB/SNB (Saudi National Bank) need to give CS some liquidity lifeline,” Roubini said.

If ECB hikes by 50bps it is possible that CS goes bust over the weekend & then the ECB has to reverse itself by next week. So hopefully it will not repeat the mistake made in 2011 during the EZ crisis when it hiked into that crisis. ECB/SNB need to give CS some liquidity lifeline

— Nouriel Roubini (@Nouriel) March 15, 2023

Roubini ’s statement comes ahead of the ECB policymakers meet on Thursday. A report by Reuters said the ECB had set for another 50 bps increase in a bid to curb price rise. However, there is a possibility that the ECB could re-consider its decision of rate hike after the collapse of Silicon Valley Bank (SVB) in the United States and Credit Suisse stock prices fall. The central bank of Europe has already committed to raising its deposit rate by 50 bps to 3 per cent on Thursday. ‘Too big to bail out’ Stocks of Credit Suisse plunged 31 per cent on Wednesday amid doubts over its financial stability. Commenting on the troubled bank situation after its shares nosedived to a record low, Roubini said Credit Suisse could be too big to bail out. “The problem is that Credit Suisse, by some standards, might be too big to fail, but also too big to be saved,” the economist told Bloomberg TV in an interview. “It’s not clear the bank’s regulators have the resources to engineer a bailout,” Roubini added. Credit Suisse failure would be like Lehman Brothers moment Roubuini, whose correct prediction of the 2008 global recession, said Credit Suisse failure would be like a “Lehman Brothers moment”. He also said trouble at Credit Suisse is “way be too much for Switzerland to handle”. Don’t Miss: Investment bank Credit Suisse's shares sink as top shareholder rules out more cash “It’s not clear that, unlike the United States, the [Swiss] federal system has enough resources to engineer a bailout,” Roubini said. Shares of Credit Suisse sank after its main shareholder - Saudi National Bank - declined to invest further. Credit Suisse will be next bank to collapse Amid Silicon Valley Bank (SVB) and Signature Bank collapse, American entrepreneur and author Robert Kiyosaki, who had forecast the 2008 collapse of Lehman Brothers, said Swiss investment giant Credit Suisse will be the next bank to collapse. “The problem is the bond market, and my prediction, I called Lehman Brothers years ago, and I think the next bank to go is Credit Suisse, because the bond market is crashing,” Kiyosaki was quoted as saying by Australian website - news.com.au. Also Read: Which will be the next bank to fail? The man who predicted the 2008 Lehman Brothers collapse has the answer Earlier in March, Kiyosaki sounded the alarm on the global economy, predicting its downfall. For the unversed, America’s fourth-largest investment bank - Lehman Brothers - crashed in September 2008 and filed for bankruptcy. So far, Lehman Brothers’ bankruptcy is said to be the largest in the history. It had total debts of $613 billion against total assets of $639 billion and 25,000 employees worldwide. Read all the  Latest News ,  Trending News ,  Cricket News ,  Bollywood News , India News  and  Entertainment News  here. Follow us on  Facebook,  Twitter and  Instagram.