Friday, October 10, 2014

David Levy: We Are In A Period Of Secular Asset Price Declines (Institutional Investor Video)

David Levy, chairman of the Jerome Levy Forecasting Center, shared his views on the U.S. economy, asset prices, leverage, and emerging markets in an interview with Institutional Investor on October 8, 2014. Watch the video below.

On corporate and household leverage:
Corporate debt relative to corporate GDP, leaving out the financial sector, is not only back above where it was going into the last recession, it's at an all time high. Household debt-to-income has come down significantly as a lot of mortgage debt was written off. But it's still about where it was in the last business cycle, which was an all time record at that point—about 2003, 2004.
On the U.S. economy, emerging markets and recession risk:
I believe that the economy is at risk of a recession not because we have an immediate threat coming from within the U.S. economy, although we would if interest rates started to rise, but rather because the rest of the world is in much worse shape than we are. ... Specifically the emerging markets sector...
On the stock market and housing prices (asset prices):
I think we are in a period of secular asset price declines.
Hear more details in the video...

Source: Institutional Investor

In another video, David Levy, Nouriel Roubini and JP Morgan's Michael Hood shared their views on the euro area economy and the euro (watch at Institutional Investor).

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