Roubini: 2-Yr Recession, 9% Unemployment, -15% More Home Prices, $3T in Losses

NYU Economist and founder of economic analysis firm RGE Monitor Nouriel Roubini told Bloomberg today that he sees the biggest US recession in 40 years that could last 12-24 months, bring unemployment to 9%, see another 15% decline in home prices, and an estimated $3 trillion in total bank losses—revised up from his previous $1-2 trillion estimate, and more than triple the $637 billion in losses as comprised by Bloomberg so far in this credit crisis.

See this link for Roubini’s market recovery advice, and see below for particularly noteworthy comments from Roubini’s interview:

The U.S. government will need to double its purchase of bank stakes and force lenders to eliminate dividends to save them from bankruptcy, Roubini added, “This will be the first round of recapitalization of the banks, the government has to decide to intervene much more directly in the provision of credit and the management of these companies.”

Treasury injected $250b today into banks and called for banks to use the money. Obviously Roubini said this is not enough to get them to actually do so, and they’ll have to force the issue.