Bank of America: Credit Markets Fried Until 2017

Tuesday, May 19, 2009 11:42 AM

By: Dan Weil

Major banks can generally be relied upon to issue the rosiest forecasts about the economy and financial markets that reality permits.

The fact that the banks maximize their profits in those rosy scenarios probably has at least a bit of influence on the forecasts.

But not Bank of America. It’s giving Nouriel Roubini, nicknamed Dr. Doom for his pessimistic predictions, a run for his money.

All the hubbub about green shoots in the economy and credit markets has no more validity than the constant drumming early in the financial crisis of the idea that the rest of the world had decoupled from U.S. woes

“Like last year’s ‘Decoupling’ theme that global market performance could un-tether itself from the problems in the U.S., ‘Green Shoots’ underlying premise, a quick return to normalized credit markets and normalized earnings, rests on a shaky fundamental foundation and an overly optimistic view of global economics,