When you look at Roubini's background: After receiving BA in political economics at Bocconi University and doctorate in international economics at Harvard University, he began academic research and policy making by teaching at Yale while also spending time at the International Monetary Fund (IMF), the Federal Reserve, World Bank, and Bank of Israel. Much of his early studies focused on emerging markets. During the administration of President Bill Clinton, he was a senior economist for the Council of Economic Advisers, later moving to the United States Treasury Department as a senior adviser to Timothy Geithner, who is now Treasury Secretary. http://en.wikipedia.org/wiki/Nouriel_Roubini It is clear to all he comes from a school of economics where the phenomenon of inflation is disregarded most of the time or when it can be denied no more labeled as something positive . (BTW, I bet that's where he learned to dislike gold ) For instance he advocated for the FED to double their efforts even after all the TARP's and other measures where taken claiming such a move would have no real inflationary pressures at all. Quite the controversial point of view I would say but then again what do I know.
Controversial about inflation? Maybe. Still, so far he was spot on. At the peak of the commodity bubble in 2008 he said "Within a couple of months inflation will be the last problem on the Fed's priority list".
Sure but as I said he also advocated the FED to double it's balance sheet even after all the programs where set in motion at the debts of the crisis in 08. When you think of the political backlash the FED encountered now consider their position if they had followed up on Roubini's advice. Hence the controversial part. A Marc Faber quote comes to mind also about how inflation isn't considered as a problem as it supports asset prices unless it affects the price of oil then it must be dealt with.
He said Goldman Sachs could not survive by itself given the fundamental changes in the market http://dealbook.blogs.nytimes.com/2008/10/10/goldman-sachs-takes-on-dr-doom/ He said oil would fall crash further in november 2008 at the very bottom of the oil market. http://www.rgemonitor.com/roubini-m..._falling_oil_prices_and_its_impacts_on_russia They all score and miss.
He supports controlling 'speculation' somehow, admits that zero interest rates are driving this, but says nothing about the source of it all - - - the Fed and other worldwide central banks ? I watch the guy because he's sharp, but anyone can predict a crash in the market. Hell, I think its gonna take a big dive too ! The trick is 'knowing' when it will crash. If his prediction happens in a year was he right ? How about within two years ? So what. - - But because he gets so much attention from everyone its not a bad idea to see what he says.
I don't recall him ever advocating that. Link? To the contrary, he has recently been on the record that the Fed has to consider outlining a pathway to removing liquidity from the markets in order to fend of the bond vigilantes.
Roubini is a fool for commenting on the direction of the SP500, Oil and gold prices. The sad thing is the idiots on bubble vision keep asking that non-sense, he should simply refuse answering. I agree with Tigerjaw's post above. Roubini can predict all the market crashes he wants, the difference is the people who follow his advice get themselves into a position without any exit strategy/stop price. Roubini has no skin in the game, he doesn't trade. He won't help anybody who gets stuck in a losing position based on his calls. He should stick with GDP, industrial production, unemployment and other hard macro data.
Goldman Sachs and the IMF calculated loses for the financial sector to top 2 trillion USD, Roubini estimated it to be more in the area of 3,5 trillion USD hence his call to really adress the fundamental bankrupt state of the system and fix it to deal with the aftermath later. Can't find the article where he supported that view right away but I did find the following chart:
Jim Rogers: Roubini hasnt done his homework....once again. http://www.bloomberg.com/avp/avp.htm?N=adviser&T=Jim Rogers Sees No `Bubbles'%20in%20Stocks%2C%20Commodities&clipSRC=mms://media2.bloomberg.com/cache/vzodcuCSAu5M.asf