A few top pros are telling us to take Nouriel Roubini’s Europe forecast with a grain of salt. They say he’s missing something kinda' important.
Roubini, also known as Dr. Doom for his bearish tone, made headlines on Tuesday after an interview on CNBC in which he outlined the potential of a perfect storm for markets in 2013. It included a crumbling eurozone.
Roubini outlined a number of catalysts, but out of all of them, top money managers Pierre LaGrange of GLG Partners, Rick Rieder of BlackRock and Anthony Scaramucci of Skybridge all winced at his comments about Spain.
Roubini said, “By the end of the year Spain (could) need a bailout. That would keep them out of the markets for a year or two. Then maybe two years down the line there would be a restructuring of the debt. That ends with a debt problem. That destroys the competitiveness. And eventually even Spain could exit the Eurozone.”
But top hedge fund manager Rick Reider says that Roubini's outlook assumes that Spain, the EU and the world at large all fail to learn anything from the current woes and the mistakes of smaller nations.
A lot of other outcomes are possible, says Reider. “A whole lot of other things could happen. Spain has tremendous liquidity - I would anticipate in Spain, we’ll see proactive movement,” before it gets that dire.