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Nouriel Roubini

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Jan 22, 2009 2:19 pm

Predicting in Forbe that we will likely have a deep, U-shaped recession with a shallow recovery in 2010, with a chance of a Japan-like lost decade. Says the S&P 500 will bottom between 500 and 720 this year.

Don't want to believe him, but he makes a strong case and has been right about most things this year.      
Jan 22, 2009 2:21 pm

Those that can DO; those that can’t TEACH!

Jan 22, 2009 3:25 pm

They call him Dr. Doom for a reason. I agree that we may not see a recovery until 2010 and that it will be a slow recovery at that for various reasons. His statement that we will see a lost decade like japan i do not agree with for one simple reason that we have a proactive central bank. As for his S and P prediction, that is one hell of a range you gave so who knows. The only reason it should matter is if you only index or just use mf’s. If you use individual securities it doesn’t matter what the s and p does or does not do this year .

Jan 22, 2009 4:07 pm

I am not a doomsayer, but just take a look at the facts.  Look around.  Look at the numbers.  Some monetary and fiscal stimulus isn’t going to get 3 1/2 million people back to work in the next few months (there are currently like 6 1/2 million unemployed).  Some of these job cuts are permanent.  MSFT just announced 5,000 layoffs.  Microsoft!  I don’t think they’ve EVER laid off.  The number of companies announcing pay REDUCTIONS is unprecedented.

I think people have to come to terms with what is going on and face the new reality for the next few years.  No, not some "new paradigm".  It's not "different" this time.  It's just what it is.  It's cause and effect.  The world isn't changing, the economy is just contracting.  It's a natural evolution of economics, it just happens to be that the magnitude of this contraction is severe.  I know many (most) of our firms still want to hang on to the "the recovery is just around the corner" mantra, but I am now starting to see major chinks in that armor.  The message is changing. There's no need to panick, we just need to adapt to the changing economy right now. 
Jan 22, 2009 11:46 pm

I think this is a great opportunity for wirehouse reps to be trading clients accounts. there will be powerful rally's in the prolonged bear market. use this as an opportunity to differenciate yourself from the typical manged money wirehouse rep. or if you're not comfortable trading -- build Large stock and bond positions, when the market turns you and your clients will be rewarded. then you can write yourself a ticket anywhere.

Million Dollar Reps are made in Bear Markets
Jan 23, 2009 2:19 pm

I understand that you said that the economy would be a U, but I thought I would add that when I spoke with him two weeks ago he said that he expected the market to be more of an L shape instead of a V. <> He added that volatility is expected to remain high and we could expect to see bottoms retested many times. Also, while he did mention a bottom possibly as low as 500, he contended that the government’s swift and severe actions might prevent us from going that low.


Jan 24, 2009 12:53 am

Topic: Nouriel Roubini

This freak show, like all perma bears,

like a broken clock…they have their day.

even today.    we WILL be right.   stocks go up over time.

This dude needs some prozac

as right as he was. his personal dollars are “all in”- Index funds.

he is a tool

Jan 24, 2009 12:55 am


please stfu.

if ur a bear get short

just quit whinning

depends at 7-11.

Jan 24, 2009 11:15 pm

Will this be a long recession? The fundamental KEY to this one, and this is the only downturn since the GD, is that systemic asset re-pricing will be the key to recovery. What is needed is a correction of the world balance sheets – indiviudlas, governments, institutions – relative prices.

  Until markets clear, at prices established where global D=S, not much is going to happen. Which in the reason the Obama 'plan' will primariy divert real resources from one productive sector to another unproductive sector (e.g electric cars, wind farms, ethanol plants).   What I also see is not a single 'commentator' addressing the differential impact of expected vs. unexpected macro economic events. Ths former are anticipated and discounted today for what is known will occur in the future. If Keynes money illusion is not present (and there's no  evidence it is) then only UNEXPECTED macroeconomic events will have any REAL ECONOMY benefits (+ or -).
Jan 25, 2009 12:31 am
CDO Squared:


please stfu.

if ur a bear get short

just quit whinning

depends at 7-11.

  You type like a guy with Teret's Syndrome and only 7 fingers.   And I am whinning.
Jan 26, 2009 5:30 pm
CDO Squared:


please stfu.

if ur a bear get short

just quit whinning

depends at 7-11.

  How do you get through a day without being able to formulate an intelligible sentence? I guess it's proof that anybody can bash their face into a keyboard and complete a trade...
Jan 30, 2009 12:48 am

Payroll reduction and layoffs are synonymous with deflation. Deflation is more terrifying than inflation. With the Fed dumping so much cash into the system means that the FOMC is clearly concerned with a steep deflationary period. They figure, get out of the problem now and worry about rampant inflation in the future. Honestly, we’re setting ourselves up for probably close to double digit inflation sometime in the next ten years.

In layman’s, they’re doing everything to keep this huge ass Buick out of the ditch. It’s difficult to convince people to spend money.

Japan’s problem was that their spending rate was too high, 20%+ and the government failed in getting people to save less and spend more. Coupled with a net population loss, they couldn’t quite jump start the economy. The US is different, we don’t have a net pop. loss and we spent too much money, 102% of our take home pay. People/institutions reacted to the economic spook by saving more money and buying less, thus the decrease in the C in y = C+I+G+(X-M). The government is trying to compensate for the decrease in C by increasing G, the problem is nobody knows the real time numbers since the lag time is a quarter to 6 months, even then we still do numbers revisions in the following months.

At least the Fed is doing something, in the early 30s they implemented policies to contract the money supply. Talk about the exact wrong thing to do.

As for people stammering about switching back to a hybrid system of the gold standard, just remember we had 4 major crises prior to coming off the gold standard. Gold did nothing to stem the Great depression, in 1907 the metallic standard made the crisis worse, the long depression from 1873-1896, and the panic of 1837.

Jan 30, 2009 3:57 am

the panic of 1837.


Jan 30, 2009 4:09 am

[quote=CDO Squared]the panic of 1837.



Coincidentally, was spawned by a real estate bubble and followed by a credit crunch.

Feb 10, 2009 3:48 am

roubini’s 15 minutes are about done.  he now sounds like henry blogett attempting to make insp his next amzn.  the dot com bust followed and blogett only recent resurfaced as a journalist.

  msft is laying off because it's product is garbage.  the autos have been on the verge of disaster for years.  most of the unemployment is construction which is experiencing a bottleneck of sorts as projects stalled due to the credit crunch will likely restart after the credit markets and the weather thaw this spring. the impact of construction activity will decrease unemployment by over 1%   this event is unprecedented, but we're running on internet time. we're only 6 months into this problem and seem ready to forecast the end of the world when in reality the effect of TARP 1 hasn't had time to materialize.   2009 y/e s&p 1070...  
Feb 10, 2009 2:42 pm

After listening to Obama last night warn of 'catastrophe' and 'a lost decade', I believe we've found a new Dr. Doom.

Feb 10, 2009 3:07 pm

After listening to Obama last night warn of ‘catastrophe’ and ‘a lost decade’, I believe we’ve found a new Dr. Doom.

in order to get this stuff to pass through congress, both bush and obama have had to scare the hell out of the country.

their process of trying to get this crap through has possibly caused more damage than if they had done nothing
Feb 10, 2009 5:44 pm

bush said the fundamentals are strong so often he was a laughingstock