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Blinder: Crisis Could Test Fed David Frazier: What a Stock Market Bottom Really Looks Like Kessler: Bailout Plan Could Work Greenspan: I Was Wrong on Deregulation David Marotta: Avoiding Another Lost Decade Existing Home Sales Up Most in 5 Years Breaking News from Moneynews.com Roubini: Expect Emergency Market Shutdown Street Talk RSS ARCHIVE Print Page  |  Forward Page  |  E-mail Us Roubini: Expect Emergency Market Shutdown Thursday, October 23, 2008 5:10 PM By: Elaine Barr Article Font Size   Former Clinton economic adviser Nouriel Roubini says hundreds of hedge funds will fail and that policymakers might have to shut down financial markets for a week or more in response. "We've reached a situation of sheer panic. There will be massive dumping of assets," and "hundreds of hedge funds are going to go bust," said Roubini, a New York University professor. He was speaking to attendees at a hedge fund conference in London. Roubini is known for his predictions. In July 2006 he said that the United States would enter an economic recession. Earlier this year, he forecast a "catastrophic" financial meltdown that he said global central bankers would fail to prevent and would lead to the bankruptcy of large banks exposed to mortgages and a sharp drop in equities. He warns, too, that the world is heading for a protracted recession that will end the financial dominance of the United States. Roubini told CNBC that he believes the United States is going to have two years of negative economic growth, quite at odds with most predictions of quarter or two of recession ahead. "The last two recessions lasted only eight months each. … This time around, this is going to be three times as long, three times as deep. This is going to be the worst recession the United States has experienced since the 1980s." Emmanuel Roman of GLG Partners, a former division of Lehman Brothers Holdings, agreed with Roubini's dire prediction. He told the Telegraph that 25 percent to 30 percent of the world's 8,000 hedge funds will disappear "in a Darwinian process," either by going bust or deciding that meager profits are not worth the effort. "This will go down in the history books as one of the greatest fiascos of banking in 100 years. There needs to be some scapegoats, and the regulators are going to go hunt people. That will be good in the long run," Roman said. © 2008 Newsmax. All rights reserved.