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  • Graham and ...: 
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  • R.W. Wentworth & Co.
  Nouriel Roubini has gotten most of it right. But gold (and silver) seems to be his blind spot. Ditto for Warren Buffett.

  Nov 04 11:52 AM | Link | Reply
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  • mb2: 
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  I somewhat agree w/Roubini. Having seen the commodities boom & bust of the 70's, I can see the same patterns now as back then. Speculation combines with the weak Dollar to force commodities bubbles. Gold may hit $2k and oil may reach $200, but not this year, or next. When fiscal conservatives begin replacing the idoits currently residing in D.C. next year, the party will start to wind down. Yes, there will be inflation, but, it won't be hyper-inflation. IMHO

  Nov 04 11:56 AM | Link | Reply
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  • Jeff Nielson: 
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  I will put my money behind Jim Rogers ANY DAY ahead of Roubini. Every time he opens his mouth he makes it more and more obvious that his "Nobel Prize" for economics was another farcical selection for this once-prized award.
  
  Here's something for "Bubbles" Roubini to chew on. While he and the other idiots talk about "bubbles" in China, there was some VERY interesting data released that China's big-banks have seen their deposits QUADRUPLE while their lending has only tripled.
  
  Obviously, when bank deposits rise faster than lending, this means that China's banks are getting LESS leveraged - not more so, as Roubini and others claim. Since bubbles are BUILT on leverage, as leverage declines, so does the mis-pricing of assets.
  
  Rogers is a better "economist" than Roubini has ever been - and doesn't need a "Nobel Prize" to demonstrate it.

  Nov 04 12:04 PM | Link | Reply
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  • MonroeTrader: 
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  Where did you get that data from Jeff ? Since when does anyone trust anything coming from the Chinese government?

  Nov 04 12:19 PM | Link | Reply
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  • Boxed Merlot: 
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  On Nov 04 12:04 PM Jeff Nielson wrote:
  
  > …China's big-banks have seen their deposits QUADRUPLE
  > while their lending has only tripled.
  
  > Obviously, when bank deposits rise faster than lending, this means
  > that China's banks are getting LESS leveraged - not more so, as Roubini
  > and others claim. Since bubbles are BUILT on leverage, as leverage
  > declines, so does the mis-pricing of assets…
  
  
  I’m asking this question only because I’ve been told there’s no such thing as a stupid question, (though this one may be the exception), but is the Chinese currency in the same state of expansion as the US FRN? Is its foundation based on “the good faith and credit” of their own governmental system, their future prospects, national commodity reserves, and / or natural resources. In other words, what drives Their printing presses?

  Nov 04 12:21 PM | Link | Reply
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  • H.J. Huneycutt: 
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  Citi's deposits grew by 16% in 2007, while their loans increased by 14.4%. Which is to say, "leverage" wasn't the sole problem with US banking system over the past decade. It was more of a "perfect storm" thing --- high leverage, reckless loan practices by certain actors, a widespread belief that RE prices would continue going upwards indefinitely, etc.
  
  
  On Nov 04 12:04 PM Jeff Nielson wrote:
  
  > Here's something for "Bubbles" Roubini to chew on. While he and the
  > other idiots talk about "bubbles" in China, there was some VERY interesting
  > data released that China's big-banks have seen their deposits QUADRUPLE
  > while their lending has only tripled.
  >
  > Obviously, when bank deposits rise faster than lending, this means
  > that China's banks are getting LESS leveraged - not more so, as Roubini
  > and others claim. Since bubbles are BUILT on leverage, as leverage
  > declines, so does the mis-pricing of assets.

  Nov 04 12:34 PM | Link | Reply
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  • H.J. Huneycutt: 
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  Roubini is right here. I like Rogers. He's a great commodities investor, but he's also been a commodities investor during one of the most massive commodity bull runs in history. His economic sense isn't very sound in many cases. And his prediction on gold is utter bunk.
  
  The case for $2000 gold is that the US will go through a period of hyperinflation. It's not happening. Any inflation at all will be somewhat of an achievement. It's possible we see a return to double-digit inflation once the economy picks up again, but if that happens, all the fear that has driven the current gold bull will be removed.
  
  I'm not saying 'don't invest in gold.' I'm just saying anyone who thinks they're going to make some monstrous return doing that is fooling their self. Gold is a safety asset. The gold miners, right now, look to be severely overpriced in the aggregate.

  Nov 04 12:42 PM | Link | Reply
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  • Boxed Merlot: 
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  On Nov 04 12:42 PM H.J. Huneycutt wrote:
  
  > …The case for $2000 gold is that the US will go through a period of
  > hyperinflation…
  > I'm not saying 'don't invest in gold.' I'm just saying anyone who
  > thinks they're going to make some monstrous return doing that is
  > fooling their self… gold miners…look to be severely overpriced.
  
  Personally, US FRN 2K Au seems reasonable if the moderate inflation you mention occurs, 5K and points north if Hyper kicks in. With miners being the physical equivalent to futures leveraging, the appearance of being “overpriced” is to be expected, and not necessarily a sound reason to avoid them. Better to steer clear of those properties where political confiscation, “legal” jurisdictional disputes and general lawlessness, (i.e. US) are currently in vogue. IMO

  Nov 05 01:20 AM | Link | Reply