Monday, December 30, 2013

ISM data shows slowing

Chicago ISM & regional survey suggest a weakening of the the ISM & manufacturing at the national level. US growth in H2 slowing to a crawl.

Thursday, December 26, 2013

Islamic finance vs conventional finance systems

There is a need for a more resilient system, and that’s where there is potential for the Islamic system. 

It is less volatile and potentially more stable than conventional financial systems. Islamic countries in South East Asia have been quite successful, like Malaysia and Indonesia, and Turkey also is quite dynamic.

The advanced economies can learn from the Islamic system in this respect. 

Tuesday, December 24, 2013

The Prospect for Emerging markets is still positive

“The prospect for emerging economies is still positive, with 5 per cent growth averages compared with 1 [to] 2 per cent over [the] past few years in the rest of the world. There are demographic dividends with young workforces, and the rise of more affluent middle classes. All this adds up to a long-term trend that is putting these countries at the centre of growth in the global economies,”

- Via muslimvillage.

Monday, December 23, 2013

Roubini Warns Canada’s Housing Bubble about to Burst

‘Dr. Doom’ warns Canada’s housing bubble about to burst |
 It’s the doctor versus the governor in the ongoing debate over the direction of Canada’s housing market. On the pessimistic side there’s 

Nouriel Roubini, the man known as “Dr. Doom” for his pessimistic outlook on the global economy. He recently pinpointed Canada’s housing market as a bubble set to pop.

Canada is in the company of other housing markets that Roubini (known as one of the few to correctly predict the U.S. housing crash) says are showing
“signs of frothiness, if not outright bubbles,” including Switzerland, Sweden, Germany, Australia and New Zealand.



Read more at ca.finance.yahoo.com


Thursday, December 19, 2013

I am Optimistic about Dubai


“Dubai at the moment has good prospects. There has been a recovery in the real estate sector. The lifestyle here is less restrictive than in other countries in the region, and there is safety and security. In the longer term, Dubai can be an important financial centre and a key economy of the region. Sometimes you make mistakes, but if you manage growth more cautiously and manage diversification properly, I’m optimistic about Dubai,”

Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics

Tuesday, December 17, 2013

Roubini : Gold Price tumbles to lowest since July

 Gold price tumbles to lowest since July - in twitter

Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics

Monday, December 16, 2013

Nouriel Roubini Warns ~ Bubbles In Several Housing Markets

Nouriel Roubini Warns ~ Bubbles In Several Housing Markets


Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics

Saturday, December 14, 2013

Roubini : There is a lot Islamic Finance can teach us

“I’m all in favour of less risk, and some elements of Islamic finance involve profit-sharing and risk-spreading, which is good. There are many things in Islamic finance that can lead to more stability. There is a lot Islamic finance can teach us,” he says.

“I do not see Islamic finance competing with conventional finance, rather it is complementary to it. The main focus will be on the Islamic world, but others will also seek to get involved, like London.

“One of the challenges of the Islamic financial systems is the issue of insolvency. Creditors have a claim over the underlying assets, which is a good thing, but bankruptcy regimes in Islamic countries are not very strong,”

Thursday, December 12, 2013

Growth in Advanced Economies has been below Trend

“Until now, growth in advanced economies has been below trend, but there are some signs of acceleration. But you have to ask how strong is the recovery in advanced economies? Are there still structural problems there?”

 Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics

Wednesday, December 11, 2013

Back to Housing Bubbles by Nouriel Roubini


NEW YORK – It is widely agreed that a series of collapsing housing-market bubbles triggered the global financial crisis of 2008-2009, along with the severe recession that followed. While the United States is the best-known case, a combination of lax regulation and supervision of banks and low policy interest rates fueled similar bubbles in the United Kingdom, Spain, Ireland, Iceland, and Dubai.

Now, five years later, signs of frothiness, if not outright bubbles, are reappearing in housing markets in Switzerland, Sweden, Norway, Finland, France, Germany, Canada, Australia, New Zealand, and, back for an encore, the UK (well, London). In emerging markets, bubbles are appearing in Hong Kong, Singapore, China, and Israel, and in major urban centers in Turkey, India, Indonesia, and Brazil.

Signs that home prices are entering bubble territory in these economies include fast-rising home prices, high and rising price-to-income ratios, and high levels of mortgage debt as a share of household debt. In most advanced economies, bubbles are being inflated by very low short- and long-term interest rates. Given anemic GDP growth, high unemployment, and low inflation, the wall of liquidity generated by conventional and unconventional monetary easing is driving up asset prices, starting with home prices.


The situation is more varied in emerging-market economies. Some that have high per capita income – for example, Israel, Hong Kong, and Singapore – have low inflation and want to maintain low policy interest rates to prevent exchange-rate appreciation against major currencies. Others are characterized by high inflation (even above the central-bank target, as in Turkey, India, Indonesia, and Brazil). In China and India, savings are going into home purchases, because financial repression leaves households with few other assets that provide a good hedge against inflation. Rapid urbanization in many emerging markets has also driven up home prices, as demand outstrips supply.

Read more at http://www.project-syndicate.org/commentary/nouriel-roubini-warns-that-policymmakers-are-powerless-to-rein-in-frothy-housing-markets-around-the-world#pU45gychTI8ulA0g.99


Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics

Monday, December 9, 2013

Outlook of the world economy - Roubini Global Economics - National Oil Companies Congress 2013

 Nouriel Roubini, Founder and Chairman of Roubini Global Economics gives his keynote address on 'What is the outlook of the world economy and what are the implications for oil markets' at World National Oil Companies Congress 2013. His presentation is followed by an interview with Alexander Poegl, Senior Analyst and Consultant for JBC Energy

The annual World National Oil Companies Congress is where leaders of the world's NOCs meet each other and their partners to debate and decide the future of the oil and gas business.


Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics

Saturday, December 7, 2013

Roubini : U.S. Economy Growth Is Low, Inflation Is Low, Unemployment Is High

The economic activity is recovering very anemically. Growth is low, inflation is low, unemployment is high. That is the reason why we have zero policy rates, we have QE, credit easing.

 Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics

Thursday, December 5, 2013

The Housing Bubble(s) Not Bursting Any Time Soon

The global economy’s new housing bubbles may not be about to burst just yet, because the forces feeding them – especially easy money and the need to hedge against inflation – are still fully operative.

Moreover, many banking systems have bigger capital buffers than in the past, enabling them to absorb losses from a correction in home prices; and, in most countries, households’ equity in their homes is greater than it was in the US subprime mortgage bubble.

Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics

Wednesday, December 4, 2013

Bond Yields Are Mispriced

Bond Yields Are Mispriced

Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics

Monday, December 2, 2013

Housing Bubbles Worldwide : We are witnessing in many countries a slow-motion replay of the last housing-market train wreck

In countries where non-recourse loans allow borrowers to walk away from a mortgage when its value exceeds that of their home, the housing bust may lead to massive defaults and banking crises. In countries (for example, Sweden) where recourse loans allow seizure of household income to enforce payment of mortgage obligations, private consumption may plummet as debt payments (and eventually rising interest rates) crowd out discretionary spending. Either way, the result would be the same: recession and stagnation.

What we are witnessing in many countries looks like a slow-motion replay of the last housing-market train wreck. And, like last time, the bigger the bubbles become, the nastier the collision with reality will be.

Sunday, December 1, 2013

Roubini : QE tapering to have positive impact on S. Korea

Future tapering of the U.S. quantitative easing (QE) would influence the South Korean economy positively, a New York University economics professor said Monday.
"QE tapering will be positive to Korea," Nouriel Roubini said in Seoul at a meeting with South Korean Finance Minister Hyun Oh- seok, noting that the QE tapering would mean a recovery of the U.S. economy, on which South Korea heavily depends for trade, according to the Finance Ministry.
Interest rate hikes in the U.S. would lead to strong U.S. dollar, having a positive impact on exports, which account for around half of the South Korean economy, said Roubini. In addition, Roubini also said that South Korea held a positive position in terms of fiscal balance and sovereign debts, assessing that the April supplementary budget was appropriate and contributed to the country's recovery. 
  

Saturday, November 30, 2013

Roubini : Indonesia could Grow faster than China and India

“Countries like India, Brazil, Turkey, South Africa and Ukraine [are also running deficits], but I would not put Indonesia in this group, even if Indonesia has some macro-financial fragility,” he said Saturday in his remarks delivered during the CEO Summit conference held as part of the APEC leaders meetings.“With the right economic reforms, the growth of Indonesia in the second half of this decade could even be higher than China and India,” Roubini predicted. - in The Jakarta Post


Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics

Friday, November 29, 2013

U.S. Stock Market not in a Bubble Yet

In a Bloomberg interview, Roubini said central bank liquidity is not going to the economic recovery but into financial transactions “We are maybe not in bubble territory for the U.S. stock market, but if you look at housing around the world — Switzerland, Sweden, Norway, France, Germany, Israel, Brazil, Hong Kong, Singapore, China — we have frothiness if not outright bubbles in housing markets in many parts of the world,” he said. Also, the tech sector appears vulnerable with start-ups being overvalued based on forward revenue they haven’t even taken in yet. In addition, central bankers face a tough choice between killing off the recovery, or fueling growth at the risk of inflating the next financial crisis.
Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics

Wednesday, November 27, 2013

Roubini ‏: In Bahrain Water more costly than Gasoline


Nouriel Roubini : In Bahrain water more costly than gasoline. Gasoline subsidized. Water costly as imported or produced with energy intensive desalinization- in twitter

Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics

Monday, November 25, 2013

Roubini : U.S. Economy Growth Is Low, Inflation Is Low, Unemployment Is High

The economic activity is recovering very anemically. Growth is low, inflation is low, unemployment is high. That is the reason why we have zero policy rates, we have QE, credit easing.


Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics 


 

Friday, November 22, 2013

Roubini Reasons for Caution

 Nouriel Roubini, chairman of Roubini Global Economics, expects recovery in the west to be 'at best weak'. He talks to Sarah Gordon, Europe business editor, a... Icerik giriniz


Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics

Thursday, November 21, 2013

Nouriel Roubini dukes with EL-Erian

Watch the video below.

Rich Countries may be entering twilight zone of Ultralow Inflation

Nouriel Roubini : Or deflation @EconBizFin: The growing fear is that rich countries may be entering twilight zone of ultralow inflation - in twitter

Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics

Tuesday, November 19, 2013

Roubini : 10 basic and key questions that the Senators failed to ask Janet Yellen at her confirmation hearing

 10 basic and key questions Senators were too naive to ask Yellen:

1. You wrote about optimal control (OC) ie allow inflation above target. Do you support OC?
2. You wrote a few times that inflation may have to go above target for a while to reduce labor slack. Do you support this optimal control?
3. Do you agree with Governor Stein that macro-pru will not be sufficient to control bubbles? Would you raise rates sooner to prick bubbles?
 4. While you say no bubble today what is the risk that slow QE exit & policy rate normalization (4 yrs) will cause bubbles down the line?
5 . If the current approach to too-big-to-fail will not work would you down the line support breaking up big banks to deal with TBTF?
6. What will be Fed losses of paying interest on excess reserves of $3 trillion+ when you will normalize policy rates to 4%? 120bn a year?
7. Fed criteria for taper is a cumulative improvement in labor mkt outlook. Aren't we there now given fall in Un Rate & 180K jobs per month?
8. After ZIRP, QE, CE, FG growth is still weak & mon pol ineffective? Wouldn't a better policy mix be more fiscal stimulus & less monetary?
9. What is risk of fiscal dominance as Fed is effectively monetizing public debt? Should mon pol be used to nudge congress to cut deficit?
 10. What is risk of debt dominance, ie Fed unable to raise rates fast enough as high public/household debt requires low debt service ratio?  - via twitter


 Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics

Sunday, November 17, 2013

Roubini : The ECB will eventually move to a Negative Deposit Rate

Nouriel Roubini: In October we at RGE also made an out of consensus call that the ECB will eventually move to a negative deposit rate and even to QE
And now senior ECB officials are openly talking about a negative deposit rate and about QE as options to fight low inflation/ strong euro - in Twitter



Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics

Friday, November 15, 2013

Roubini on The Financial Armageddon

Nouriel Roubini : If you worry about Financial Armageddon, it is indeed metaphorically the time to stock your bunker with guns, ammunition, canned food and gold bars.


Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics

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Thursday, November 14, 2013

Roubini ‏: China has a plan for Comprehensive Reforms

Nouriel Roubini : Both President Xi & Premier Li confirmed to us that China has a plan for "comprehensive reforms". Details to be unveiled at the Third Plenum - in twitter
 [Highway in China]


Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics

Wednesday, November 13, 2013

Roubini says central bankers have a tough choice: Kill recovery or risk bubbles

In the aftermath of the financial crisis six years ago, unconventional tools like quantitative easing and zero-interest rate policies may have sparked an economic recovery but not one of turbocharged growth or low unemployment. That puts policy makers between a rock and a hard place, NYU economist Nouriel Roubini wrote in an opinion piece at Live Mint on Wednesday. He added:
“Policymakers will eventually face an ugly trade-off: kill the recovery to avoid risky bubbles, or go for growth at the risk of fueling the next financial crisis.”

One problem is that much of the excess liquidity created by these unconventional policies has gone into the the financial sector rather than the real economy, encouraging carry trades that make for frothy financial markets, Roubini said.

Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics

Monday, November 11, 2013

QE did not help Investment

As below-trend GDP growth and high unemployment continue to afflict most advanced economies, their central banks have resorted to increasingly unconventional monetary policy. An alphabet soup of measures has been served up: ZIRP (zero-interest-rate policy); QE (quantitative easing, or purchases of government bonds to reduce long-term rates when short-term policy rates are zero); CE (credit easing, or purchases of private assets aimed at lowering the private sector’s cost of capital); and FG (forward guidance, or the commitment to maintain QE or ZIRP until, say, the unemployment rate reaches a certain target). Some have gone as far as proposing NIPR (negative-interest-rate policy).

And yet, through it all, growth rates have remained stubbornly low and unemployment rates unacceptably high, partly because the increase in money supply following QE has not led to credit creation to finance private consumption or investment. Instead, banks have hoarded the increase in the monetary base in the form of idle excess reserves. There is a credit crunch, as banks with insufficient capital do not want to lend to risky borrowers, while slow growth and high levels of household debt have also depressed credit demand.

Saturday, November 9, 2013

Roubini: Fiscal Drag Is Damaging U.S. Growth

Roubini: Fiscal Drag Is Damaging U.S. Growth Nov. 7 (Bloomberg) -- On today's "Chart Attack," NYU Stern School of Business Professor Nouriel Roubini and Bloomberg's Matt Miller look at how the government is weighing on economic growth. They speak on Bloomberg Television's "Street Smart." (Source: Bloomberg)
 Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics

Tuesday, November 5, 2013

Free Markets don’t generate enough final demand

The result is that free markets don’t generate enough final demand. In the US, for example, slashing labor costs has sharply reduced the share of labor income in GDP. With credit exhausted, the effects on aggregate demand of decades of redistribution of income and wealth – from labor to capital, from wages to profits, from poor to rich, and from households to corporate firms – have become severe, owing to the lower marginal propensity of firms/capital owners/rich households to spend.

Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics

Monday, November 4, 2013

The laissez-faire Anglo-Saxon Model has also now failed miserably

Some of the lessons about the need for prudential regulation of the financial system were lost in the Reagan-Thatcher era, when the appetite for massive deregulation was created in part by the flaws in Europe’s social-welfare model. Those flaws were reflected in yawning fiscal deficits, regulatory overkill, and a lack of economic dynamism that led to sclerotic growth then and the eurozone’s sovereign-debt crisis now.

But the laissez-faire Anglo-Saxon model has also now failed miserably. To stabilize market-oriented economies requires a return to the right balance between markets and provision of public goods. That means moving away from both the Anglo-Saxon model of unregulated markets and the continental European model of deficit-driven welfare states. Even an alternative “Asian” growth model – if there really is one – has not prevented a rise in inequality in China, India, and elsewhere.

Friday, November 1, 2013

To Avoid Revolution, Workers’ Rights needed to be protected

Even before the Great Depression, Europe’s enlightened “bourgeois” classes recognized that, to avoid revolution, workers’ rights needed to be protected, wage and labor conditions improved, and a welfare state created to redistribute wealth and finance public goods – education, health care, and a social safety net. The push towards a modern welfare state accelerated after the Great Depression, when the state took on the responsibility for macroeconomic stabilization – a role that required the maintenance of a large middle class by widening the provision of public goods through progressive taxation of incomes and wealth and fostering economic opportunity for all.
- in project-syndicate


Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics

Thursday, October 31, 2013

Karl Marx oversold socialism, but he was right

Nouriel Roubini has long argued that Karl Marx was a big fan of socialism and does not agree with many of his ideas. However Roubini does agree with Marx when he says capitalism can be its own cause of danger. Regulation even if it may be minor is needed to help keep capitalism rolling along well.


Tuesday, October 29, 2013

Brazil Was Too Hyped

Two years ago at the Milken Conference, Eike Batista criticized me in our panel for saying that Brazil was too hyped. Today he is nearly bankrupt. - Via tweet


Related trading instruments: iShares MSCI Emerging Markets (ETF) (EEM), iShares MSCI Brazil Index (ETF) (NYSE:EWZ), SPDR Gold Trust (ETF) (GLD)

Nouriel Roubini is an American economist. He teaches at New York University's Stern School of Business and is the chairman of Roubini Global Economics. 

Wednesday, October 23, 2013

Dr. Nouriel Roubini says call me Dr. Realist

“I prefer to be called Dr. Realist. I’m not either a pessimist or an optimist. It’s not as if I’m a perma-bear. Right now there is a global economic recovery, so I think you have to be a realist about what can go right, and what can go wrong.”

Monday, October 21, 2013

Global recovery is coming

"I think that a global recovery is going to occur, so you might want to be marginally overweight in equities."

Thursday, October 10, 2013

Euro Monetary Union: Disintegration Risk Has Diminished Significantly

"A little more than a year ago, in the summer of 2012, the eurozone, faced with growing fears of a Greek exit and unsustainably high borrowing costs for Italy and Spain, appeared to be on the brink of collapse. Today, the risk that the monetary union could disintegrate has diminished significantly – but the factors that led to it remain largely unaddressed." - in The Guardian

Related ETFs:  iShares MSCI Spain Index ETF (EWP), iShares MSCI Italy Index ETF (EWI), iShares Germany ETF (EWG)

Nouriel Roubini is an American economist. He teaches at New York University's Stern School of Business and is the chairman of Roubini Global Economics.


View the original article here

Wednesday, October 9, 2013

Political Risks Rise In West Countries

"Political risks rise in West countries: U.S. goverment shutdown risk; Italian goverment collapse risk; uncertainty on German government; Greece & Portugal risks." - in Twitter

Related ETFs: Financial Select Sector SPDR (ETF) (XLF), SPDR SP 500 ETF (NYSE:SPY), iShares MSCI Italy Index ETF (EWI), iShares Germany ETF (EWG), iShares MSCI Spain Index ETF (EWP)


Nouriel Roubini is an American economist. He teaches at New York University's Stern School of Business and is the chairman of Roubini Global Economics.

Tuesday, October 8, 2013

Eurozone's Fundamental Problems Remain Unresolved

"Beneath the surface calm of lower spreads and lower tail risks, the eurozone's fundamental problems remain unresolved. For starters, potential growth is still too low in most of the periphery, given ageing populations and low productivity growth, while actual growth – even once the periphery exits the recession, in 2014 – will remain below 1% for the next few years, implying that unemployment rates will remain very high.

Meanwhile, levels of private and public debt, domestic and foreign, are still too high, and continue to rise as a share of GDP, owing to slow or negative output growth. This means that the issue of medium-term sustainability remains unresolved.


At the same time, the loss of competitiveness has been only partly reversed, with most of the improvement in external balances being cyclical rather than structural. The severe recession in the periphery has caused imports there to collapse, but lower unit labour costs have boosted exports insufficiently. The euro is still too strong, severely limiting the improvement in competitiveness that is needed to boost net exports in the face of weak domestic demand." - in The Guardian


Related ETFs: iShares Germany ETF (EWG), iShares MSCI Italy Index ETF (EWI), iShares MSCI Spain Index ETF (EWP)


Nouriel Roubini is an American economist. He teaches at New York University's Stern School of Business and is the chairman of Roubini Global Economics.

Sunday, October 6, 2013

If A Government Shutdown Cannot Lift Gold, What Else Will?

If a government shutdown cannot lift gold, what else will? - in Twitter

Related stocks and ETFs: SPDR Gold Trust (ETF) (GLD), Newmont Mining (NEM), Barrick Gold (ABX), Goldcorp (GG), Market Vectors Gold Miners ETF (GDX)


Nouriel Roubini is an American economist. He teaches at New York University's Stern School of Business and is the chairman of Roubini Global Economics.

Monday, September 30, 2013

US Banks Are Even-Bigger-To-Fail

"Five years after Lehman's collapse US banks are even-bigger-to-fail given consolidation: J.P. Morgan taking over Bear Stearns, Bank of America taking Countrywide & Merrill Lynch, Wells Fargo taking Wachovia." - in Twitter

Related stocks: Bank of America (BAC), J.P. Morgan (JPM), Wells Fargo (WFC)


Nouriel Roubini is an American economist. He teaches at New York University's Stern School of Business and is the chairman of Roubini Global Economics.

Sunday, September 29, 2013

Tapering: The Consensus Got It Wrong

"As The Economist put it the Fed is a Taper Tiger. But the consensus got wrong the "silence of the doves": they were fully data dependent." - in Twitter

Related ETFs: SPDR SP 500 ETF (NYSE:SPY), SPDR Gold Trust ETF (GLD), iShares MSCI Emerging Markets (ETF) (EEM)


Nouriel Roubini is an American economist. He teaches at New York University's Stern School of Business and is the chairman of Roubini Global Economics.

Saturday, September 28, 2013

Italy`s Crisis

"if the situation worsens, which now seems hardly impossible, the consequences could be very damaging for Italy. "Our most probable scenario is elections in early 2014 but we do not exclude even sooner than that.

The markets are reasoning in a similar way. If there is no solution, the spread will rise to 300 (3.0 percentage points) in a few days and the calm period for the Italian stock market will come to an end. Bank stocks will be particularly hard hit and credit costs will continue rising. The sooner the elections, the worst the damage for bonds." - in brecorder 


Related ETFs: iShares MSCI Italy Index ETF (EWI)


Nouriel Roubini is an American economist. He teaches at New York University's Stern School of Business and is the chairman of Roubini Global Economics.

Thursday, September 26, 2013

Emerging Market Rout: There`s More To Come

"I do not think we are finished with the rout in any of the emerging market asset classes, maybe we are more than midway but there is more to come. After all, what we know about the global environment is that the West is showing more signs of recovery. That points to tapering from the Fed.

We do not know exactly when that tapering is going to come. We do not know how much tapering is going to be. We do not know yet when the tapering will be followed by stop in the expansion of the Fed’s base money, more do we know when and by how much the Fed will tighten.


There are lots of stages in the shift in the US and therefore the global monetary and financial conditions environment that have yet to take place that would stretch out for a couple of years and it is that uncertainty and the threat of the coming reduction in the easing of monetary conditions that precipitated all this and on top of that now we have the Syrian situation becoming more escalated.


So, countries like India which are capital thirsty are still going to be in the forefront of this risk reduction episode across global markets." - in CNBC TV18 

Related ETFs: iShares MSCI Emerging Markets (ETF) (EEM), WisdomTree India Earnings Fund ETF (EPI), iShares MSCI Brazil Index (ETF)


Nouriel Roubini is an American economist. He teaches at New York University's Stern School of Business and is the chairman of Roubini Global Economics.

Tuesday, September 24, 2013

U.S. Inequality Sharply Rising Again

"U.S. inequality sharply rising again above Gilded Age levels: Top 1% take biggest income slice on record" - in Twitter

Nouriel Roubini is an American economist. He teaches at New York University's Stern School of Business and is the chairman of Roubini Global Economics.

Monday, September 23, 2013

Dysfunctional U.S. National Politics

"Investors seem to underestimate how dysfunctional US national politics has become." - in Twitter

Nouriel Roubini is an American economist. He teaches at New York University's Stern School of Business and is the chairman of Roubini Global Economics.

View the original article here

Saturday, September 21, 2013

Emerging Markets Decoupling Story Was Over-Hyped

"Emerging markets decoupling story was always over-hyped - Fed taper talk reaction shows EMs still linked to developed world." - in Roubini`s Official Twitter 

Related ETFs: iShares MSCI Emerging Markets (ETF) (EEM), iShares FTSE/Xinhua China 25 Index (ETF) (NYSE:FXI)

Friday, September 20, 2013

U.S. Economy: Potential Growth Falling Towards 2 Percent?

"Stagnation of US productivity over the last year. A sign that potential growth is falling towards 2%?" - in Roubini`s Official Twitter

Related ETFs: Financial Select Sector SPDR (ETF) (XLF), SPDR Dow Jones Industrial Average ETF (DIA), SPDR SP 500 ETF (NYSE:SPY)


Nouriel Roubini is an American economist. He teaches at New York University's Stern School of Business and is the chairman of Roubini Global Economics.

Thursday, September 19, 2013

Sign of Labor Market Weakness

"Fall in unemployment rate is driven by fall in labor force participation rate, sign of labor market weakness with more discouraged workers." - in Twitter

Nouriel Roubini is an American economist. He teaches at New York University's Stern School of Business and is the chairman of Roubini Global Economics.

Tuesday, September 17, 2013

Bond Yields Are Mispriced

"Tapering of September Tapering. The Fed should not start tapering given mediocre GDP growth and labor market. Bond yields mispriced." - in Twitter

Related ETFs: Financial Select Sector SPDR (ETF) (XLF), SPDR SP 500 ETF (NYSE:SPY)

Nouriel Roubini is an American economist. He teaches at New York University's Stern School of Business and is the chairman of Roubini Global Economics.


View the original article here

Monday, September 16, 2013

United States: 3 Sources Of Policy Uncertainty Will Come To A Head This Autumn

Today, the global economy is facing many known unknowns, most of which stem from policy uncertainty. "In the United States, three sources of policy uncertainty will come to a head this autumn. For starters, it remains unclear whether the Federal Reserve will begin to “taper” its open-ended quantitative easing (QE) in September or later, how fast it will reduce its purchases of long-term assets, and when and how fast it will start to raise interest rates from their current zero level. There is also the question of who will succeed Ben Bernanke as Fed Chairman. Finally, yet another partisan struggle over America’s debt ceiling could increase the risk of a government shutdown if the Republican-controlled House of Representatives and President Barack Obama and his Democratic allies cannot agree on a budget.

The first two sources of uncertainty have already affected markets. The rise in US long-term interest rates - from a low of 1.6 percent in May to recent peaks above 2.9 percent - has been driven by market fears that the Fed will taper QE too soon and too fast, and by the uncertainty surrounding Bernanke’s successor.


So far, investors have been complacent about the risks posed by the looming budget fight. They believe that – as in the past – the fiscal showdown will end with a midnight compromise that avoids both default and a government shutdown. But investors seem to underestimate how dysfunctional US national politics has become. With a majority of the Republican Party on a jihad against government spending, fiscal explosions this autumn cannot be ruled out." - in Project Syndicate


Related ETFs: Financial Select Sector SPDR (ETF) (XLF), SPDR SP 500 ETF (NYSE:SPY), iShares MSCI Emerging Markets (ETF) (EEM)


Nouriel Roubini is an American economist. He teaches at New York University's Stern School of Business and is the chairman of Roubini Global Economics.

Thursday, August 22, 2013

BRIC`s: Emerging Economies May Hit A Thick Wall

"Of course, some of the better-managed emerging-market economies will continue to experience rapid growth and asset outperformance. But many of the Brics, along with some other emerging economies, may hit a thick wall, with growth and financial markets taking a serious beating." - in The Guardian 

Related ETFs: iShares MSCI Emerging Markets ETF (EEM), iShares MSCI Brazil Index ETF (EWZ), Market Vectors Russia ETF (RSX)

Nouriel Roubini is an American economist. He teaches at New York University's Stern School of Business and is the chairman of Roubini Global Economics.


View the original article here

Tuesday, August 20, 2013

Underdog in the Race for Fed Chair May Now Be the Frontrunner

"My new paper Larry Summers: Underdog in the Race for Fed Chair May Now Be the Frontrunner" - in Roubini`s Official Twitter

Related ETFs: Financial Select Sector SPDR (ETF) (XLF), SPDR Gold Trust (ETF) (GLD), SPDR SP 500 ETF (NYSE:SPY)


Nouriel Roubini is an American economist. He teaches at New York University's Stern School of Business and is the chairman of Roubini Global Economics.


Monday, August 19, 2013

Low Growth: Brazil, Russia, China & South Africa

"Brazil's GDP grew by only 1% last year, and may not grow by more than 2% this year, with its potential growth barely above 3%. Russia's economy may grow by barely 2% this year, with potential growth also at around 3%, despite oil prices being around $100 a barrel. India had a couple of years of strong growth recently (11.2% in 2010 and 7.7% in 2011) but slowed to 4% in 2012. China's economy grew by 10% a year for the last three decades, but slowed to 7.8% last year and risks a hard landing. And South Africa grew by only 2.5% last year and may not grow faster than 2% this year." - an excerpt from the Is the emerging market boom over?

Nouriel Roubini is an American economist. He teaches at New York University's Stern School of Business and is the chairman of Roubini Global Economics.

Saturday, August 17, 2013

The Benefits Of The U.S. Oil Production Boom

"The domestic benefits of the U.S. oil production boom are well documented — everything from the creation of high-paying jobs to sending less money to foreign oil producers.

Less well appreciated are the geopolitical benefits. U.S. oil production has already paid foreign policy dividends in at least one vital area: It has paved the way for stronger sanctions on Iran by helping to keep the global oil market well-supplied and minimizing oil price volatility.


This development is timely and instructive."


Nouriel Roubini is an American economist. He teaches at New York University's Stern School of Business and is the chairman of Roubini Global Economics.

Monday, July 29, 2013

Stock Market Rally, Asset Bubbles & Crash

“For the next year or so, as long as the economy grows 1.5-2 percent, and you have easy money, this market can go higher. Growth is slow. Earnings growth is also slowing down. Top line and bottom line are not as good as they used to be, but margins are high. They could correct, somehow, over time. This might lead to a generalized credit and equity and asset bubble in the next year or two, followed by a crash.”

Sunday, July 28, 2013

Gold Is Solely A Play On Capital Appreciation

"Unlike other assets, gold does not provide any income. Whereas equities have dividends, bonds have coupons, and homes provide rents, gold is solely a play on capital appreciation. Now that the global economy is recovering, other assets – equities or even revived real estate – thus provide higher returns." - in A World Of Ideas

Friday, July 26, 2013

The Ongoing Weakness of America’s Economy

The ongoing weakness of America’s economy—where deleveraging in the private and public sectors continues apace—has led to stubbornly high unemployment and sub-par growth. The effects of fiscal austerity—a sharp rise in taxes and a sharp fall in government spending since the beginning of the year—are undermining economic performance even more.

Wednesday, July 24, 2013

France Is Slipping Into A Recession

"France is slipping into a recession that complicates the austerity & reform agenda." - in Roubini`s Official Twitter

Related ETFs: iShares MSCI France Index ETF (EWQ)

Tuesday, July 23, 2013

Fed's Liquidity Injections Are Not Creating Credit For The Real Economy

The problem is that the Fed's liquidity injections are not creating credit for the real economy, but rather boosting leverage and risk-taking in financial markets. The issuance of risky junk bonds under loose covenants and with excessively low interest rates is increasing; the stock market is reaching new highs, despite the growth slowdown; and money is flowing to high-yielding emerging markets.

Sunday, July 21, 2013

Market Outlook: Gravitational Forces & Levitational Forces

"It could go on for another year or two. Of course, there are two forces. Growth is slow. Earnings growth is also slowing down. Top line and bottom line are not as good as they used to be, but margins are high. They could correct, somehow, over time.

But you have the gravitational forces of slow economy leading eventually to correction, but then the levitational forces of QEs, zero policy rates, more money coming in the market – not just from the U.S., but from other economies – it's going to levitate asset prices.


So, as I pointed out, this might lead to a generalized credit and equity and asset bubble in the next year or two, followed by a crash. But for the next year or so, as long as the economy grows 1.5-2 percent, and you have easy money, this market can go higher. "- in Business Insider 

Related ETFs: SPDR SP 500 ETF (SPY), Financial Select Sector SPDR ETF (XLF), iShares MSCI Emerging Markets ETF (EEM)

Saturday, July 20, 2013

Be Sure Your Seat Belt Is Securely Fastened

“Be sure your seat belt is securely fastened, because nothing has really come to rest. We have entered the ‘New Abnormal’, a period in which...the wise investor is prepared to be surprised.”



Related ETFs: iShares MSCI Emerging Markets (ETF) (EEM), SPDR SP 500 ETF (NYSE:SPY), SPDR Gold Trust ETF (GLD)

Friday, July 19, 2013

Wednesday, July 17, 2013

Kenya: An Economy With Many Opportunities & Many Challenges As Well

Interesting policy meetings in Nairobi. Kenya is an economy with many opportunities and many challenges as well.

Tuesday, July 16, 2013

Dr Nouriel Roubini says Rwanda is fascinating...

Rwanda is a fascinating country with a visionary leader and a very competent policy team. It has been growing close to 8% for many years now

Its impressive economy growing at 8% a year albeit from a low base. And Kigali has good urban planning unlike other African cities " 

Gold Bugs Strangely Silent & Quiet

"Gold bugs strangely silent and quiet. They must be eating crow..."

Sunday, July 14, 2013

Gold: Keynes’s ‘Barbarous Relic’

“Gold remains John Maynard Keynes’s ‘barbarous relic,’ with no intrinsic value and used mainly as a hedge against mostly irrational fear and panic.”

Nouriel Roubini on Zimbabwe inflation decline

 Zimbabwe had the highest peacetime hyperinflation ever in 2008. But now inflation is in the single digits

Monday, July 8, 2013

There is a painful period that can last over a decade

It’s been anemic because the financial crisis was one, first in which it was too much debt, leverage and excessive risk taking in the private sector, households, banks, financial institutions, even corporates. And now is the result of the resolution of financial crisis were the search of public debt and deficits.

Historically, whenever you start with too much private and public debt, there is a painful period that can last over a decade, where growth is going to be anemic. Why? Because you have to spend less, to save more or dissave less to gradually reduce this tox of deficit and debt.

And that implies that economic growth has been very weak in the United States, in Europe, in Japan and other advanced economies. And that’s going to continue. Eventually, that slow economic growth is associated with rising unemployment rate, and also with social and political unrest. That’s the situation we’re facing right now – is unstable disequilibrium, is the new abnormal. We’re ahead of decade of very low economic growth.” 

Thursday, July 4, 2013

Italy: Critical To Implement Policies To Restart Growth

With a new government in place and ongoing recession it is critical to implement policies to restart growth

Monday, July 1, 2013

The Gold Bubble Is Deflating

"The runup in gold prices in recent years – from $800 per ounce in early 2009 to above $1,900 in the autumn of 2011 – had all the features of a bubble. Now, like all asset-price surges that are divorced from the fundamentals of supply and demand, the gold bubble is deflating."

Gold is not a means of payment

A currency serves three functions, providing a means of payment, a unit of account, and a store of value.

Gold may be a store of value for wealth, but it is not a means of payment; you cannot pay for your groceries with it. Nor is it a unit of account; prices of goods and services, and of financial assets, are not denominated in gold terms.

Thursday, June 27, 2013

Roubini: Investors should have a modest share of gold

Yes, all investors should have a very modest share of gold in their portfolios as a hedge against extreme tail risks. 

But other real assets can provide a similar hedge, and those tail risks – while not eliminated – are certainly lower today than at the peak of the global financial crisis.

Wednesday, June 26, 2013

Growth In Emerging Markets

“It was already evident in the first and second quarters of this year that growth in China and other emerging markets was slowing.”

Tuesday, June 25, 2013

Gold has no intrinsic value

Gold remains John Maynard Keynes’s ‘barbarous relic,’ with no intrinsic value and used mainly as a hedge against mostly irrational fear and panic.

Monday, June 24, 2013

The Exit From The Feds QE And Zero-Interest-Rate Policies Will Be Treacherous

"The exit from the Fed's QE and zero-interest-rate policies will be treacherous: Exiting too fast will crash the real economy, while exiting too slowly will first create a huge bubble and then crash the financial system. If the exit cannot be navigated successfully, a dovish Fed is more likely to blow bubbles."


Related ETFs: SPDR Gold Trust (ETF) (GLD), SPDR SP 500 ETF (NYSE:SPY), iShares MSCI Emerging Markets (ETF) (EEM)

A New Period of Uncertainty & Volatility Has Begun

"New period of uncertainty & volatility has begun; it seems likely to lead to choppy economies & markets."

Friday, June 21, 2013

Gold: A 6-Point Bear Case

Here’s a recap of Roubini’s six-point case, in his piece for Project Syndicate:
1. Gold spikes in times of serious economic, financial and geopolitical risks — think “financial Armageddon.” But that doesn’t make it such a safe investment, says Roubini, noting sharp falls in gold prices during crisis periods of 2008 and 2009.

2. Gold performs best in times of high inflationary risks, as its popularity grows under the view that it is a hedge against inflation. But even after aggressive monetary policy by central banks, he says, global inflation is low and dropping further, and commodity prices are adjusted downwards.

3. Gold provides no income. With equities, you get dividends; with bonds, coupons and with property, rent. Now that the global economy is recovering, other assets are providing higher returns — so who needs gold, which has “vastly” underperformed since early 2009 versus stocks, he asks.

4. Real rates are headed higher on the view that the Federal Reserve and other central banks are going to back out of quantitative easing and zero-policy rates. “The time to buy gold is when the real returns on cash and bonds are negative, and falling,” and that’s not now, he says.

5. Highly indebted sovereigns are not pushing investors towards gold and away from their bonds. In fact, many of these governments have high stocks of gold, which they may dump to cut debt. Italy, for one, could be tempted to pare back on its huge holdings.

6. Political conservatives in the U.S. have hyped gold so much that it’s become counterproductive. “For this far-right fringe, gold is the only hedge against the risk posed by the government’s conspiracy to expropriate wealth,” he says.

Wednesday, June 19, 2013

Gold Prices Are Likely To Move Much Lower

"There are many reasons why the bubble has burst, and why gold prices are likely to move much lower, toward $1,000 by 2015."

Related stocks and ETFs: SPDR Gold Trust (ETF) (GLD), Newmont Mining (NEM), Barrick Gold (ABX), Goldcorp (GG)

UK: Economy Still Fragile

UK economy still fragile as there's barely any positive growth & EU Brixit saga creates uncertainty.

Monday, June 17, 2013

Art: A New Major Asset Class

"From the Venice Art Biennal it looks like art is indeed a new major asset class. It may be in a bubble as a frenzy of new collectors emerges."

Thursday, June 13, 2013

Fed`s Liquidity Injections Are Not Creating Credit For The Real Economy

The problem is that the Fed's liquidity injections are not creating credit for the real economy, but rather boosting leverage and risk-taking in financial markets. The issuance of risky junk bonds under loose covenants and with excessively low interest rates is increasing; the stock market is reaching new highs, despite the growth slowdown; and money is flowing to high-yielding emerging markets.

Tuesday, June 11, 2013

A Global Quest For Yield

“With interest rates on government bonds in the US, Japan, the United Kingdom, Germany, and Switzerland at ridiculously low levels, investors are on a global quest for yield.” - in CNN money

Monday, May 20, 2013

Dr Doom Roubini sees market going higher

There are two forces. You have the gravitational forces of the slow economy leading eventually to correction. But then the levitational forces of QEs, zero policy rates, more money coming in the market – not just from the U.S., but from other economies – it’s going to levitate asset prices.

Thursday, May 9, 2013

Market to crash by 2015 or 2 years


It[Market rally] could go on for another year or two.

Of course, there are two forces. Growth is slow. Earnings growth is also slowing down. Top line and bottom line are not as good as they used to be, but margins are high. They could correct, somehow, over time.

But you have the gravitational forces of slow economy leading eventually to correction, but then the levitational forces of QEs, zero policy rates, more money coming in the market – not just from the U.S., but from other economies – it's going to levitate asset prices.

So, as I pointed out, this might lead to a generalized credit and equity and asset bubble in the next year or two, followed by a crash.

Bu for the next year or so, as long as the economy grows 1.5-2%, and you have easy money, this market can go higher.