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Eight Forty-Eight

Former International Monetary Fund Economist Predicted Meltdown

The International Monetary Fund says losses from the current meltdown could cost banks and other financial institutions $4 trillion. IMF's former chief economist Raghuram Rajan says he saw it coming. He left the IMF in 2006 to return to his post as a professor at the University of Chicago Booth School of Business. Right at the height of the boom in 2005 he said the economy was heading for serious trouble. He had been asked to write a speech honoring former Federal Reserve chairman Alan Greenspan, and how the financial system was better off under him. Rajan then realized that wasn't the case.

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