The Next Best Buy?
The Hoffman Brothers uncovered an electronics retailer which is scaring Best Buy! We're up BIG. See how you can profit NOW.
As many of you know, Wall St. Cheat Sheet is on a mission to expose some of the biggest frauds on Wall Street. Most recently we did an extensive open-source research project on Nouriel Roubini and Jim Cramer. As a follow up, a new friend Nadeem Walayat posted a nice chart (including full citations) of Roubini’s major money-losing calls in 2009:
I’ve come to the conclusion that the only people ignorant enough to defend Roubini are those who accidentally listened to him during the one brief moment he was right (for all the wrong reasons). If you followed his bearish advice in 2005, you would have either missed the entire rally through 2007, or you would have lost money shorting the market. If you would have followed his advice starting on March 9, 2009, you would have lost a ton of money. We should also note that Roubini said Oil would stay below $40 a barrel for all of 2009. Ouch.
Anyway, once again, science and facts prove that there are many “gurus” on TV telling the investing public how to invest, yet they cannot beat an ETF.
Readers who liked this also enjoyed these:
How to Save a Friend from the False Prophet Nouriel Roubini
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When I see a heading with the word “faring” misspelled as you have just written it, I know that I am dealing with an ignorant writer, who has no conception of the origin of the words s/he is using.
You are correct. My typo is complete reason to conclude I am ignorant. Or maybe it’s that I work 14 hours a day with no editor and right now I have a terrible virus. Thanks, Mr. Perfect. BTW: you improperly placed a comma before the word “who” … if you want to be anal about it.
HEY, don’t you talk to Tim Carmell like that! /Sarcasm.
just quick question tho… why Roubini? there has been so many people that they have been wrong, they are wrong everyday on cnbc :D …
There are plenty of posts here about Cramer and a few others. We are starting with the biggest fraud Bull, Cramer, and the biggest fraud Bear, Roubini. We will work down from there. Please send as many suggestions as possible regarding others who we should investigate.
Thanks, Dean!
Sorry, Damien, there is no problem with that comma placement. Your bad.
Sorry JuanitoVerde, Damien is 100% correct. Please refer to Strunk & White’s “The Elements of Style”
Thanks, Charlie!
LOL. Seriously? There are 3 commas in that one sentence and the one between “writer, who” inappropriately chops up the clause. It’s a common mistake many people make to add commas where they would take a breath, but that doesn’t mean it’s grammatically correct.
Like everything, grammar rules can be debated in certain instances. Anyway, that guy said my entire collection of work is completely worthless because I made one typo. A comment like that is completely illogical and ignorance per se. I have never met a perfect human being, and I am sure that guy is not an exception.
Since I work 12-14 hours a day maintaining a blog where most people receive everything for free, comments like that are also simply rude. If our site was missing citations or riddled with typos, I could understand a complaint. But I do not have an editor helping me and I am working my ass off to provide FREE information. It’s always a nice reminder how many people are assholes no matter what they take for free (and likely never give in return) …
I’m not sure exactly when he first called investors to exit the market. but considering the damage done to equities since they peaked, it is highly possible that Roubini is beating the ETF over longer periods.
Likewise, I have been somewhat unapologetic about missing a chunk of this year’s rally in Russia, because I advised selling close to the top I did’t need to take unnecessary risk by buying before the trend was well established.
In Roubini’s case, I think he is simply making logical use of over-popularisation. When the media comes calling, few would turn it away. I guess he doesn’t expect to be right all the time, but his big hits certainly keep him in the game throughout periods like this rally.
James Beadle
James,
Roubini first said to exit the market in early 2005 in his paper with Brad Setser. For a complete explanation of his picks with FULL bibliography, hold your nose and go here:
http://wallstcheatsheet.com/breaking-news/economy/how-to-save-a-friend-from-the-false-prophet-nouriel-roubini/?p=2804/
one general rule, if they are sharing their ideas on tv or website , or have enough time to be on tv or writing weblogs, most likely NOT very successful people otherwise would be busy trading and making big money …. nobody will share wining ideas for free!
Exactly ;) There is a reason he is not running a fund.
Damien,
Yes, you are right. Nouriel Roubini has been wrong about the short term effectiveness of Geithner’s plan to rob the average taxpayer buy bailing out the big banks instead and allowing the same corrupt heads of these institutions to continue with the same rules for so long.
So his calls have been off and considerably since the March lows. He is an economist not an investment adviser. I am sure if you want investment advise you can go to all the major banks and it will be the same…buy…buy..buy…the same call all the time..straight to the Dot Com Bubble and right up to the Credit Crisis that wiped out a decade of gains.
So think for a moment, if he said stop investing in equities in 2005 he would have saved you money as they are below their 2005 level. So yes bubbles are very bubbly, causing huge spikes. But to dismiss a guy who’s macro view was so dead on about the banks, their exposure and how it would unfold and did unfold is a very bad call on your part.
Your point: If we are at the start of a new bull market that will take us to new highs, Roubini has missed the train. But that jury is still out and most of the respected economists in the world would say we have some serious risks ahead.
Phil,
Thank you for your thoughtful comment. Unfortunately, Roubini has been wrong about A TON of things:
http://wallstcheatsheet.com/breaking-news/economy/how-to-save-a-friend-from-the-false-prophet-nouriel-roubini/?p=2804/
I spent over two months collaborating with top financial pros all over the world who contributed to the very comprehensive bibliography which accompanies that video. There is also a link to all Roubini’s works. Read them. He is not worthy of ANY praise. In fact, you will blush. I’ve read them all.
Second, many people who want to stick up for Roubini (God only knows why when you read his papers) keep saying he is an economist and not an investment advisor. Well, if that were true, he should not be in the financial media giving outlooks about where he thinks the market is headed. He should stick to talking about the economy (which, again, his thoughts on the economy have been terribly wrong. Read his works.).
Lastly, to say that we should accept Roubini’s errors because others were saying “Buy, Buy, Buy” makes no sense. Here are two gentlemen who should have taken Roubini’s place in the main stream media:
Josh Rosner
http://wallstcheatsheet.com/knowledge/medal-of-honor-top-analyst-josh-rosner-nailed-the-crisis/?p=1959/
Chris Whalen
http://wallstcheatsheet.com/knowledge/medal-of-honor-banking-analyst-chris-whalen-best-at-breaking-down-banks/?p=2549/
If a mediocre NFL player was on ESPN every week talking about his outlook for the teams and season, people would change the channel. This is the exact analogy for Roubini getting face time in the mainstream media. I want to see Ray Lewis talk about defense and Tom Brady talk about offense. Not someone whose record clearly indicates they don’t deserve to be on the field.
Damien,
I respect your comments. Again you are correct in that Roubini should be leaving market timing to the pros. In fact, from a trading perspective he’s timing is horrible. But that is the case with most economists. As the saying goes, markets can remain irrational longer than you can remain solvent.
Did he not grant you an interview, hence the diatribe? Let’s just put things in perspective, when everyone was calling for the sun to rise every morning, like it always did, and there were a few, like Roubini who called for the disappearance of the sun, a miraculous feat for the daily morning risers, that isnt just getting one right…That is getting THE ONE right.
As i said, he called for a bubble end and a recession to come> he was calling for it a bit early (1-2 yrs). Not off that much if you consider we ARE suffering the worst financial crisis since the Great Depression. When Greenspan infamously spoke about markets being in a state of “irrational exuberance” in 1996!, he was right. Since then we had Asia Currency Crisis, Russia Default, LTCM meltdown, Dot Com Bubble and the “piece de resistance” the Credit Crisis. Once again, had you stopped buying equities a decade ago, you would be where you are now, and that is on top of almost a 60% rally off the lows. That says it all.
Roubini should be taken to task on calling markets, and you are right to do so and he should learn to keep quiet. But he was one of the very few who saw and called for the scope and breadth of the crisis. His analysis on the Banking losses ($3 Trillion Globally) was later confirmed in a catch up phase by the IMF and others. Staggering insight into both the problems and its quantitative consequences, horrible trader.
PhilBen,
First, I am very glad to converse with intelligent people such as yourself. Thank you for being thoughtful and conversational rather than just name-calling and what most people do since they don’t know how to have a friendly debate or discussion. For that, thank you.
One thing to note: Roubini thought the crisis would come because foreigners would diversify out of US Dollars. Instead, we had a credit market collapse. This is all available in his 2005 paper with Setser:
http://ideas.repec.org/a/fip/fedfpr/y2005ifebx13.html
As to why I chose Roubini: He is the most well-known bear. I use Cramer as an example for bulls. I never asked Roubini for an interview (although I know several people connected to NYU Stern) and have absolutely no personal issue with him. I hear he is a nice guy. There are a lot of nice people who don’t deserve attention for their subpar work. I think we are living through an important transition in financial media, and a huge part of the transition depends on finally exposing the people in the mainstream financial media who cause people to lose money when they take the “expert” advice.
Thanks and please feel free to share your thoughts anytime. I enjoyed this.
Damien,
I thank you for your time spent educating the public and allowing us a forum to express ourselves. I guess ultimately the reason some of us defend Roubini, is that while we were and still are being lied to and conspired against, see:
http://www.pbs.org/wgbh/pages/frontline/warning/
as usually, by our politicians and The Fed, our bank “analysts” and the media, a few had the courage to seem crazy and receive the wrath of the industry. The quest for good journalism and public debate is hard fought these days. Lets hold up our ends of the effort. I enjoyed the NIN soundtrack, echoes from a decade when our future seemed so bright.
Thanks, PhilBen! I look forward to your comments on additional topics.
I think these comments about Nouriel not running a fund are a bit off the mark. I’m pretty sure he’s enjoying what he does and making as much money as he wants, because if not I am also pretty sure he could raise money.
And let’s be careful, one could easily through the same “spare time” missive at bloggers! (of which I am one, so please – don’t take it as a criticism)
I am sure Roubini is having fun and making money off his celebrity appearances and consulting fees. The questions are: What value does he add? (Read his papers. The answer is none.) Is he worthy of celebrity appearances in the financial media? (See the answer to question #1.) Is it reckless to have him in the financial media giving his outlook on markets? (Yes, given his track record.)
He said oil would remain under $40 a barrel for all of 2009 (if you shorted that call you’d be screwed) and the S&P would continue to collapse (they have rallied over 60%). The guy is now saying gold is going to collapse. Really? Maybe if governments stop printing paper and issuing debt.
His defenders say his predictions were wrong only because the government has goosed the economy. Does Nouriel not have the ability to change his view? Well, he has rejected the S&P rally the entire way while reiterating his pessimism. That means he has accepted the new variable of government intervention and has not altered his stance. As all good traders know, “If only …” is not an investment philosophy. It’s an excuse for being wrong.
I run my money with our newsletter ;) I was trading successfully for years and wanted a different lifestyle. Trading fulltime is a whole different level of intensity and stress. I am a writer and love running this business. Trading was solitary. I was invited to be part of a fund and turned it down so I can run this business with my brother. Whether Nouriel runs a fund or not, his track record is public fact and it is as ugly as a human face recently smashed by the hoof of a bucking stallion.
BTW: I like your site. We should talk via email. Contact me.
This guy is just another waste of time. Roubini is not a market timer. And his original call was in December 2008, when he predicted that the stimulus would help but there would be a serious issue in the middle of 2010 with an exit strategy. Be patient on that one because there are a rather large group of people expecting the same thing. As far as the current bull market being a bear market rally; well that is exactly what it is. Any number of excellent analysts have said the same thing. Bear market rallies are great for traders, but they are sure death for the retail investors. Retail investors tend to invest in a stock and stick with it for a year or more. That strategy does not work in a bear market rally. So we are going to see even more of the retirement savings of Americans wiped out when this asset bubble implodes. Will you come back at that time and apologize for the damage that you have done? I seriously doubt it!
Thanks, Bill. For your information, Roubini’s original call was not in December 2008. That was his 4th or 5th call after he back-peddled several times. You are welcome to read all his works at the link supplied in the bibliography accompanying this open-source project of Roubini’s public record:
http://wallstcheatsheet.com/breaking-news/economy/how-to-save-a-friend-from-the-false-prophet-nouriel-roubini/?p=2804/
The guy is a fraud. Plain and simple. It’s all public record.
You want to follow some people who should be praised yet don’t have time to be celebrities? Read Josh Rosner and Chris Whalen. Your retirement account will thank you for it.
I will gladly apologize to Roubini if I am incorrect. But if you spend a week of your life reading all his papers and watching his television appearances, you will learn that there is no apology warranted.
Due diligence. It’s what separates the sheeple from the top of the pyramid …
I have come to the conclusion that N. Roubini has–at least once in the past–kicked your dog. This is part of your long-term strategy to serve revenge on the canine kicker.
I don’t know Roubini. It’s not personal. I am equally critical of Cramer. This is a movement to bring transparency and quality to Wall St and the financial media. Nothing more.
Isn’t hindsight wonderful?!
Allow me to elaborate.
These people – JC, NR, etc. are doing something they really should not be doing – making predictions. In this case, about the future direction of the stock market and it’s intricacies. People like you on the other hand, sit there collecting data as time goes by and then present it to your readers AFTER said predicters have been proven wrong. In other words, while they volunteered to find a path through the minefield, you were wise enough to keep your mouth shut and your eyes open. Brilliant. However, beware the snipers!
The collection of NR and JC stories is to begin shining a light on the absurdity of people acting like they can predict the future. It’s a scam. The best anyone can offer is “if, then” conditional statements. People offering predictions to the public should be required to provide a stop-loss price in the likely event they are wrong.
Hindsight is wonderful. It proves who was right and who was wrong. Although, we did not keep our mouth shut. I blogged through the crash at my former blog and our Newsletter is a year old with what have been excellent picks.
Oh yes, you forgot about Harry S. Dent. You should collect data on him and write about him too.
Can you send some links to get us started? Thanks!