As far as Nouriel Roubini is concerned the ammunition cupboard is bare of any silver bullets that could stave off a second dip to this recession. "The US has run out of bullets" said the New YorkÂ University professor.
While governments are fearful of talking economies down there are a "caste of luminaries with grim forecasts" ready to do so according to Ambrose Evans-Pritchard in the Telegraph.
Speaking at the Ambrosetti conference on Lake Como in Lombardy, Italy Dr Roubini poured cold water on the idea that a new round of Quantitative Easing would solve the problem and put a 40% chance in the double dip occurring. He is also predicting that the US growth rate was destined for a figure less than 1% during the latter half of 2010.
“More quantitative easing (bond purchases) by the Federal Reserve is not going to make any difference. Treasury yields are already down to 2.5pc yet credit spreads are widening again. Monetary policy can boost liquidity but it can’t deal with solvency problems,” He said.
Dr Roubini also pointed to the state of employment, with not just numbers of people forced put of work but also the extra hours lost from the remaining jobs. He puts the total at 11 million lost posts that would take 450,000 new jobs created every month over three years to replace.
He was joined in painting a grim bearish picture for the future by Hans-Werner Sinn, head of Germany’s IFO Institute and Harvard Professor Niall Ferguson.
The big concern for Niall Ferguson was the accelerating debt repayments that the US will somehow have to fund in the future. “The fiscal crisis seems to be out of control. The 'big crossover’ is approaching when the US spends more on debt service costs than on security, and historically that is the tipping point for any global power.”
Dr Sinn pointed out that the market for US mortgage CDOs (collateralised debt obligations) had collapsed from Â£1.9 trillion to just $50 billion, which would mean the only thing keeping the US property market afloat would be government action.
Dr Roubini is pretty scathing of recent policies aiming to keep the economy afloat by saying “All we did was kick the can down the road and stole demand from the future.”