Roubini: The Recovery as a House of Cards

Includes: DIA, QQQ, SPY
by: TraderMark

This video really highlights how far out of consensus I must be.

It's been a while since we posted any Nouriel Roubini content here and, as I sat listening to the video below, all I could think was, "that makes sense," "I'm with you on that point" and "bingo!" Then I hear the clucking from the CNBC hosts - guest or otherwise - about how these theories simply cannot be true. Theories that seem so obvious to me.

They contend that Nouriel is ignoring the evidence of recovery all around us. I feel like taking the little video player and shaking it... hello CNBC hosts, COST-BENEFIT analysis! Do you realize you are celebrating bounces off of multi-decade lows? Bounces that cost a few trillion dollars worth of stimulus/handouts/morphine to engineer? And yet they are still extremely limp? We are citing 33.4 hour work weeks as recovery when all-time lows are 33.2 hours? Is the logic just that "you need to start somewhere?"

Gosh, I can only imagine the outright cries of joy when the census workers begin adding 1.3M jobs and our unemployment issues are "solved." But it does help me to understand the masses on the "other side" of my trade and what logic they are using, even if I think most of the "logic" is "denial." I guess we'll only know in retrospect a few years from now who is correct.

Needless to say, I remain in Nouriel's camp... apparently we're both on the run outside the Matrix. Nouriel needs to stick to economic forecasting, which he does a very good job of, and stay away from his market calls, which is one way to get his credibility tarnished.

[Nov 4, 2009: Nouriel Roubini on CNBC: "Mother of all Carry Trades"]
[Aug 13, 2009: They Broke Nouriel Roubini, but not Marc Faber]
[Aug 20, 2008: Roubini - "Told You So"]
[Mar 13, 2008: Scary Stat of the Day: Roubini Calling for $1 Trillion - $3 Trillion in Losses]