Thursday, December 25, 2008

Nouriel Roubini Wishes you a Merry Christmas!

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Unlike myself, who in 2009 has pledged to balance my 98% of gloom (err, reality) with 2% panda, Nouriel Roubini apparently has no such plans. Frankly, I'm even more bearish (get it??... bearish --------->) than him on a few areas ... but how effective the government is in trying to hand out "free" money (and how willing demand by consumers is for said dollars) is going to be the major variable to watch for 2009. Frankly I think the darling thesis mongers ("can't get worse! the Fed is ever powerful!") who live in income brackets far above what most Americans live in, simply don't realize the devastation to savings both via house and stock market - and the unwillingness to take on risk (i.e. more debt) no matter what the cost (Japan was handing out 0% money for a decade and no one wanted it), no matter how hard the Federal Reserve wants to shove new loans down people's throats. But that's just me, thinking Americans have finally learned their lesson. We're going to find out and the juicy irony is that what is best for Americans individually (save, rebuild balance sheets, avoid more debt at any cost) is the opposite of what our new (and improved) service based economy needs. It needs spenders... even if it leads to personal detriment. Remember as our famous leader said; go forth and shop ... or the terrorists have won (I paraphrase) ;)

Both Roubini and I have pointed to some smaller emerging markets as major danger areas risking contagion; I've highlighted the newly debt ladden (it worked for the US! We should do it too!) Eastern European countries.

I'll have a piece this weekend on how India's financial system avoided much of this (God forbid - a real regulator who did not cow tow to banks and politicians) but in the U.S. we live on dogma (regulation is evil! let the financiers watch themselves so they can innovate! let the financially illiterate populace fend for themselves versus the "Corporation" - the free market will solve it all! Yee haw!)

Below is a 3 part interview with FT.com

Part 1 (4 minutes)



Part 2 (5 minutes)



Part 3 (5 minutes)



But not to worry... it's all priced in, and Obama will take care of it all, along with Uncle Ben. (the pundits promise us) Just go shop and buy homes... the nanny state will take care of it all.

Folks, if I'm even 70% correct on what's coming down the pike the next 18 months; expect to see a lot of pandas populating the website.

[Sep 30: Roubini on the Bailout - Thumbs Down]
[Sep 15: Nouriel Roubini with a Series of Videos on Yahoo Tech Ticker]
[Aug 20: Nouriel Roubini: "Told you So"]
[Mar 13: Scary Stat of the Day: Roubini Calling for $1 Trillion - $3 Trillion in Losses]

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