Nouriel Roubini says that the worst of the financial crisis may be behind us. The change in sentiment - Roubini has been one of the bearish analysts - is certainly a positive development. He does warn, however, that the developed nations will lag in growth. http://classic.cnbc.com/id/15840232?video=1184914198&play=1
http://www.rgemonitor.com/roubini-m..._finances_and_lead_to_protectionist_pressures Mounting Job Losses Will Hurt Consumption, Housing, Banksâ Balance Sheets, Public Finances and Lead to Protectionist Pressures PrintShare Delicious Digg Facebook reddit Technorati Nouriel Roubini | Jul 14, 2009 Recent data suggest that job market conditions are not improving in the United States and other advanced economies. In the U.S., the unemployment rate, currently at 9.5%, is poised to rise above 10% by the fall. It should peak at 11% some time in 2010 and remain well above 10% for a long time. The unemployment rate will peak above 10% in most other advanced economies (especially Europe and Japan), too, where social safety nets are broader and thus leading to less short term job losses and pain, but where the effects of the crisis on growth have been even more severe than the U.S. But these raw figures on job losses, bad as they are, actually understate the weakness in world labor markets. If you include partially employed workers and discouraged workers who left the U.S. labor force, for example, the unemployment rate is already 16.5%; even temporary employment is sharply down. Monetary and fiscal stimulus in most countries has done little to slow down the rate of job losses as economies suffer from problems of insolvency, not just illiquidity, and as the fiscal stimulus programs are too small and not labor intensive enough. As a result, total labor income â the product of jobs times hours worked times average hourly wages â has fallen dramatically. Moreover, many employers, seeking to âshare the painâ of the recession and slow down the rate of layoffs, are now asking workers to accept cuts in both hours and hourly wages. Thus, the total effect of the recession on labor income of jobs, hours and wage reductions is much larger. Other indicators are suggesting a protracted period of job losses and a persistently high unemployment rate even after the recession is over. The average duration of unemployment is not at an all time high in the U.S. Many manufacturing sectors are on a secular decline (autos, etc.) and employers are shedding jobs on a permanent basis; employment in the previously bubbly sectors (housing and related housing/real estate services, banking and financial services) is falling sharply and will not recover for a long time. The process of offshore outsourcing of both blue collar and white collar jobs is still in full swing. A lot of the job losses in the U.S. and in other advanced economies are structural rather than cyclical; many jobs will never come back. A sharp contraction in jobs and labor income has many negative consequences on both the economy and financial markets. There are at least five important ones that we will discuss next: --- I love how both cnbc and the markets can spin this stuff as positive just because he may have said there won't be negative gdp growth soon.
Thats why the market surged around 1:30pm. Dr. Doom says worst is behind and Meridith Whitney upgrades GS to 180+. I guess the new bull market is here to stay. Both have been negative for years have finally spoken positive. Go long and make risk free money all the way back to s$p 1500.
Investing/Opinion Author ToolsView Bio More Articles by This Author RSS | Email Kass: Roubini Top? 07/16/09 - 03:23 PM EDT I have seen too many in the investment world and on other stages make one outstanding call only to express a continuing dogma (and an absence of rigor) in the face of changing conditions. I have characterized the March bottom as not only a generational one but as "The Nouriel Roubini Market Bottom." This was not meant as an ad hominem attack on Dr. Doom, just an exclamation point to my call for a market turn. Perhaps Dr. Doom's expression of optimism will mark The Nouriel Roubini Top! Doug Kass writes daily for RealMoney Silver, a
Quite the superstar isn't he? total Grizzly at 700. but at 950....the world may not be that bad. Sheeesh...what a tool!!
HA, you are right, everything could go wrong at 700 and 2 months later at 950 he thinks the worst is far behind. I guess when you see the markets rally 4,5,6,7 days in a row you feel everything is better and the worst is behind but just wait until the dow does start heading lower and lower and all those who turned bullish jump to the other side, boy will they look like fools.
You traders don't understand; He's not calling a stock market bottom, he's just saying the recession (meaning negative gdp growth) should be finished soon. If you read the article I posted, you'd see he also discusses how the recovery will likely be jobless, weak and extremely slow.