Nouriel Roubini Seriously Misguided on Gold, on Equities, on Economic Growth, on Money

http://globaleconomicanalysis.blogspot.com/2013/06/nouriel-roubini-seriously-misguided-on.html

Gold Takes Out 200DMA...The Other Way

Roubini is wrong on calling a top on gold--again. 

http://www.zerohedge.com/news/gold-takes-out-200dmathe-other-way

Thanksgiving Tally: Lunatics And Hacks Win As Gold Up 19.3% YTD; S&P Down 7.5%

I guess I'd rather be a lunatic and a hack--than to be wrong and lose money.

http://www.zerohedge.com/news/thanksgiving-tally-lunatics-and-hacks-win-gold-193-ytd-sp-down-75

Why Nouriel Roubini Is Wrong About Gold

http://azizonomics.com/2011/09/01/why-nouriel-roubini-is-wrong-about-gold/

Roubini Says Rogers’s $2,000 Gold ‘Utter Nonsense’

Here's a quote from November 4, 2009 about the price of gold from Nouriel Roubini, NYU professor of Economics.  He's a respected expert who has an unshakeable faith in Keynesian economics.

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aOfwpkHV2clM&pos=5

Nouriel Roubini, the economist who predicted the global economic crisis, said a forecast by investor Jim Rogers that gold will double to at least $2,000 an ounce is “utter nonsense.”

There is no inflation or “near-depression” to drive gold prices that high, Roubini said today at the Inside Commodities Conference in New York. If a severe depression came to pass, with investors buying canned goods and hiding out in log cabins, “maybe you want some gold in that scenario,” Roubini said.

“Maybe it will reach $1,100 or so but $1,500 or $2,000 is nonsense,” Roubini said. Gold rose to a record $1,098.50 today in New York on speculation that central banks and investors will purchase the metal to hedge against a declining dollar.

What's that expression?  Those than can, do.  Those that can't, teach.  Hey Nouriel, stick to teaching your voodoo economics.

Roubini: "It's Pretty Clear The Housing Market Has Already Double Dipped"

http://www.zerohedge.com/article/roubini-its-pretty-clear-housing-market-has-already-double-dipped

http://www.cnbc.com/id/40564296

Economist Nouriel Roubini on Wednesday voiced concern over a compromise on extending tax cuts struck by US President Barack Obama and Republican leaders, saying the agreement could expose the US to bond vigilantes who will drive up bond yields.

Bond vigilantes – the term was coined by economist Ed Yardeni in the 1980s to describe major investors who demand higher yields to compensate for the perceived risks resulting from large deficits - could derail the country’s precarious recovery, some economists say.


 Chinese central bank adviser Li Daokui said on Wednesday the fiscal health of the United States was worse than Europe's, and that the dollar had so far been shielded from trouble because markets are still focused on debt-laden European countries.

US bond prices and the dollar would fall when the European situation stabilizes, Daokui said.

Here is my previous breakdown of long-expiry US Treasury bonds:  http://gregnguyen.blogspot.com/2010/07/httpwww.html

This is what I did in an attempt to hedge against rising bond yields (and interest rates):  http://gregnguyen.blogspot.com/2010/01/bubble-in-treasury-bond-market.html

Note the usual disclaimers in the left side bar and disclosures in the linked blog entries.

Currency war brews

It's also Rickards vs. Roubini. Understand that while Roubini correctly called the financial crisis, so did Rickards. But Roubini also said gold was in bubble territory at $1100/oz, or thereabouts. Here's proof that he dismissed gold's prospects last year:

http://www.project-syndicate.org/commentary/roubini20/English

He may be considered a great economist by many, but that's also why the field of economics is called the "dismal science." The best ones are often wrong.

And the best ones can't even figure out the basic economic laws of supply and demand. Trillions of dollars are created with one computer keystroke by Blackhawk Ben Bernanke. Yet, it takes years of sweat, man, machine, and luck to produce an ounce of gold and silver. Paper currencies may be created out of thin air instantaneously, but precious metals are found and mined at an excruciatingly slow pace.

I'm glad Roubini isn't managing my money.

Dr. Doom Nouriel Roubini

Nouriel Roubini, a money manager and professor at Yale, was nicknamed Dr. Doom for his apocalyptic economic forecasts. I agreed with most of his reasons: high debt levels and unsustainable deficits. But I am calling him out on his forecasts for gold. Here is a partial excerpt from his website (it is partial because I am not a client of his):

http://www.roubini.com/analysis/91695.php

In a Bloomberg interview in November 2009, Roubini said gold was a bubble that was about to burst. Gold was priced at $1100/oz at the time. When billionaire hedge fund manager Jim Rogers declared gold would double to $2000, Roubini dismissed it as "utter nonsense."

He was wrong then and I'm going on record that he will be wrong going forward. When gold does reach $2000, will Roubini apologize to Rogers and admit he was wrong? I doubt it. If gold plummets to $500, I promise I will admit I was wrong.

See disclaimer on side bar.

Disclosure: long physical gold and silver, long precious metals mining shares.

Banking system insolvent

Jan. 20 (Bloomberg) -- U.S. financial losses from the credit crisis may reach $3.6 trillion, suggesting the banking system is “effectively insolvent,” said New York University Professor Nouriel Roubini, who predicted last year’s economic crisis.

“I’ve found that credit losses could peak at a level of $3.6 trillion for U.S. institutions, half of them by banks and broker dealers,” Roubini said at a conference in Dubai today. “If that’s true, it means the U.S. banking system is effectively insolvent because it starts with a capital of $1.4 trillion. This is a systemic banking crisis.”

Losses and writedowns at financial companies worldwide have risen to more than $1 trillion since the U.S. subprime mortgage market collapsed in 2007, according to data compiled by Bloomberg.

President Barack Obama will have to use as much as $1 trillion of public funds to shore up the capitalization of the banking sector, following the $350 billion injection by the Bush administration, Roubini told Bloomberg News. Congress last year approved a $700 billion rescue fund, of which half remains to be disbursed.

Bank of America Corp., the largest U.S. bank by assets, posted a quarterly loss of $1.79 billion last week, its first since 1991, and received $138 billion in emergency government funds. Citigroup Inc. posted an $8.29 billion fourth-quarter loss, completing its worst year, and plans to split in two under Chief Executive Officer Vikram Pandit’s plan to rebuild a capital base eroded by the credit crisis.

‘Bankrupt’ System

“The problems of Citi, Bank of America and others suggest the system is bankrupt,” Roubini said. “In Europe, it’s the same thing.”