Economic Armageddon

Stephen Roach, the chief economist at investment banking giant Morgan Stanley, has a public reputation for being bearish.

But you should hear what he's saying in private.

Roach met select groups of fund managers downtown last week, including a group at Fidelity.

His prediction: America has no better than a 10 percent chance of avoiding economic ``armageddon.''

Press were not allowed into the meetings. But the Herald has obtained a copy of Roach's presentation. A stunned source who was at one meeting said, ``it struck me how extreme he was - much more, it seemed to me, than in public.''

Roach sees a 30 percent chance of a slump soon and a 60 percent chance that ``we'll muddle through for a while and delay the eventual armageddon.''

The chance we'll get through OK: one in 10. Maybe.

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Story.

I've been saying this for months. There are too many economic variables (interest rates, fuel prices and availability, wars) that are balanced on a razor's edge. The money folks in the Bush Maladministration are far too stupid to keep 'em all balanced for long. Even Greenspan, whom I thought was mostly apolitical, is clearly in Bush's pocket. We've been living on cheap, and borrowed, money for too long and the notes are gonna come due. It's gonna get ugly when they do. Might not be as bad as Roach says, but it'll suck out loud regardless.