March 3, 2011

Economic Forecasters, the Bears: Gross, Roubini, Rodriguez & More—a Slide Show

THE BEARS

It's the Bears vs. the Bulls, but this playing field is economic prognostication.  AdvisorOne presents a slide show of some of the noted economic pessimists and optimists. First up this week are ... da Bears.

 

BILL GROSS
PIMCO founder and

managing director

 

Gross' “new normal” has found a home, and it's in the grim post-industrial Allentown immortalized in the Billy Joel song. In his December commentary letter to clients, Gross expands on the theme of his famous “new normal” speech about living in a time of deleveraging and reduced economic expectations. Gross argues that the downshift in global demand increases global competition for a slice of the world’s smaller economic pie.

Regarding the Fed's QE2 plan unveiled in November, Gross wrote in a November commentary, “The Fed’s announcement will likely signify the end of a great 30-year bull market in bonds and the necessity for bond managers and, yes, equity managers to adjust to a new environment.”

Talk about bursting your bubble ...                         

It's the Bears vs. the Bulls, but this playing field is economic prognostication.  AdvisorOne presents a slide show of some of the noted economic pessimists and optimists. First up this week are ... da Bears.

 

NOUREIL ROUBINI
Co-founder of Roubini Global Economics and a professor at NYU's Stern School of Business

 

Roubini's financial analysis firm, Roubini Global Economics, issued a report on Feb. 28 that theorized muni bonds were in for a fall—a big fall, to the tune of some $100 billion—over the next five years, as state and local governments default on obligations.

And at Davos this year, he said that the world may have stepped back from the brink of collapse in 2008, but it faced huge risks ranging from spiraling food and commodity prices to the danger of trade and currency wars, against a background of growing inequalities that threaten stability.

Wait, this is called "stepping back" from collapse?

It's the Bears vs. the Bulls, but this playing field is economic prognostication.  AdvisorOne presents a slide show of some of the noted economic pessimists and optimists. First up this week are ... da Bears.

 

ROBERT RODRIGUEZ
CEO of First Pacific Advisors

 

Invigorated after a year-long sabbatical (see Research magazine's interview with him as he was preparing to take his break), the renowned fund manager Rodriguez, in a recent exclusive interview with AdvisorOne, sternly warned that the markets and the economy were threatened by the government’s tardiness in addressing fiscal reform. Unless restructuring begins within seven months, he said in the Feb. 8th interview, a new financial meltdown will likely befall us in a few years.

Maybe we should go on sabbatical.

It's the Bears vs. the Bulls, but this playing field is economic prognostication.  AdvisorOne presents a slide show of some of the noted economic pessimists and optimists. First up this week are ... da Bears.

 

MEREDITH WHITNEY
Manager, Meredith Whitney Advisory Group

 

Already popular for her earlier predictions on Citigroup and the economy, Whitney's interview on CBS’ “60 Minutes” program in December pushed her back up to the top of the prognostication heap.

She predicted a muni finance crisis of epic proportions, with 50 to 100 major defaults amounting to hundreds of billions of dollars in losses. “I think next to housing this is the single most important issue in the United States and certainly the largest threat to the U.S. economy,” she told interviewer Steve Kroft.

She nearly makes Roubini sound like a pie-in-the-sky optimist--nearly.

It's the Bears vs. the Bulls, but this playing field is economic prognostication.  AdvisorOne presents a slide show of some of the noted economic pessimists and optimists. First up this week are ... da Bears.

 

HINDENBURG OMEN
Economic calamity based on certain market indicators

 

The actual Hindenburg disaster occurred in Lakehurst, N.J., in 1937 and killed 35 people. The Hindenburg Omen was supposed to occur in the U.S. in 2010 and kill the New York Stock Exchange.

The Omen, based on a grouping of five linked technical indicators that have historically made their joint appearance preceding previous market crashes, was talked about last year and particularly piqued nervous interest on Friday the 13th in August on blogs and articles all over the financial sphere.

Mathematician Jim Miekka, credited with devising the system in 1995, says his colleague Kennedy Gammage came up with its doomsaying name when they realized that "Titanic" had already been used for another predictor.

Next up in financial disaster names ... the Mount St. Helens Omen.

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