Roubini says concerted efforts likely to prevent meltdown

I read as widely as I can to get a sense of what's happening in the Northern Hemisphere and in the banking systems in particular. I haven't read a lot else lately.  In recent months I've been following a guy called Nouriel Roubini very closely. He's the Professor of Economics at New York University's Stern School of Business and has a PHD from Harvard. He has advised the US Treasury and the White House. He also runs a subscription website called www.rgemonitor.com In February he wrote a piece called "12 Steps to Financial Disaster" that predicted step by step the banking, financial markets and economic catastrophe that has engulfed most of the world in recent weeks. It was very controversial at the time, but turned out to be very accurate. I remember reading it at the time and feeling a little queasy. If this guy's right, I thought, we're all in trouble. He was right. Now he is saying that the concerted actions by central banks and governments in recent days to recapitalise banks and guarantee deposits will restore some confidence and will help avoid a complete systemic meltdown. Many of his recommendations have been adopted by the US Treasury, the UK government and the Eurozone governments in recent days, often after weeks of prevarication. This is the first time I've heard him call the bottom and say a meltdown will be avoided. Here's what he says.

While most of the economic and financial damage is already done and the global economy will not be able to avoid a painful recession, financial and banking crisis (i.e. the V-shaped short and shallow 6-month recession is now out of the window and we will experience a severe and more protracted 18 to 24 months U-shaped recession) the rapid and consistent implementation of these and other actions will prevent the US, European and global economies from experiencing a systemic financial meltdown and entering in a more severe L-shaped decade long stagnation like the one experienced by Japan after the bursting of its real estate and equity bubble. Are we close to the bottom of this financial crisis? Today stock markets "“ and other financial markets - will rally on the news that terrified policy makers peering into the abyss got religion and started to do in a consistent way what is necessary, but financial markets will remain volatile with significant downside risks over the next few weeks.