Roubini: "It's Pretty Clear The Housing Market Has Already Double Dipped"

Tyler Durden's picture

Hopefully today's 4th consecutive decline in home prices, as per the earlier noted Case Shiller October data (and with both mortgage rates and foreclosure inventory surging, we are willing to bet that following the reported November and December CS data, the decline will be for half a year straight), makes it sufficiently clear that housing has double dipped, and that the primary goal of Bernanke, which is not to pad banker bonuses, but to reflate home prices and recreate that mythical HELOC "fake wealth effect" piggybank, has been a complete failure (he sure is succeeding in getting WTI about to soon hit $100/barrel). Just in case there are any doubters left, Nouriel Roubini sat down with CNBC's netnet to confirm what virtually everyone else already knows: "It's pretty clear the housing market has already double dipped," per Nouriel, who recently took advantage of the NYC housing downturn and bought a $5.5MM pad. "And the rate of decline is stronger than in previous months" - precisely what we pointed out a few hours back. In other words, the double dip is accelerating. Today's jump in 10 and 30 Y rates will not help.

Furthermore, another rather obvious observation by Roubini demonstrates precisely why the drop in home prices is just starting to be felt: "The shadow inventory of not-yet-foreclosed homes—due to the moratorium—will surge in the next year." In other words, "Supply will increase, demand will drop."

Also, keeping in mind that there are tens of millions of Americans who are underwater on their mortgages, and thus not incentivized to pay their bills, any ongoing price drops will create a vicious loop whereby more and more people walk away from mortgages, and otherwise stop paying, as a result of which, banks will be forced to REO at least some of these properties (it is well known that banks allow squatters to live under payment delinquency for up to 24 months: where else does America get the money for that 4th Kindle and 2nd iPad?), causing prices to drop even more, and make the Catch 22 even worse. Which means that very soon Ben will again be forced to do a ritualistic killing of the stock market, pretty much as what happened on May 6, to get the population out of stocks again and back into bonds. Because should the 10 Year pass 4%, it is game over for housing, no matter how much Goldman protests, and the Chairman knows it all too well.


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unwashedmass's picture


no one is getting out of here alive....except the folks who own the hard and silver.

wretch's picture

And a goodly amount of lead, brass and steel in the right configurations.  The hard stuff.

Financial_Guardian_Angel's picture

That article you linked to from "Rich Dad, Poor Dad is God aweful and the chart is outdated and misused. 10 minutes of my life I can never get back...

Richard Weed's picture

In my opinion Roubini is a morose clown.

Please STOP giving this talent-less self-promoter the time of day.

Yes, 10 minutes of my life I shall never get back... thanks alot.

A Nanny Moose's picture

don't forget the alcohol...the hard stuff.

Ragnar D's picture

You want your lead to be the soft stuff, generally...

101 years and counting's picture

Um, killing the stock market no longer guarantees money flowing into bonds.  Looks like retail is done with both.  Plainly stated, they need the money to pay monthly food and energy bills.


plocequ1's picture

Housing Market.. Is there a stock symbol for that?

Cortez's picture

FNM and FRE.........  or maybe it is SOL.

Id fight Gandhi's picture

Seems to be $

As fed money flows to crooks.

Home builders continue to rise as business keeps tanking.

gbresnahan's picture

double dip?

we haven't even finished dipping once, IMHO

akak's picture

Yeah, "Double Dip" presumes a "Recovery" that none of us were able to see whiz by.  Well, none of us except for HarryWanger, who somehow managed to hitch a ride --- so he says.

I think the only real "Double Dip" is those who keep calling for one.  The rest of us can clearly see this ongoing and deepening depression for what it truly is.

Seasmoke's picture

not sure what recovery was harder to see, the RE Recovery or the Summer of Recovery

themosmitsos's picture

"accelerating" being the key word ;)

RobotTrader's picture

What a crock.

Roubini just shelled out $5.5 million for a condo and took out a $3 million mortgage so he has a fancy place to take his hookers over the weekend.

Obviously, he's touting more "doom and gloom" just to rake in more speaking engagement fees.

the not so mighty maximiza's picture

WOW, real women with real fees


goldmiddelfinger's picture

I would junk the photo but I like Ruby and his taste in women far more than I dislike robutt's poor tact

grunk's picture

They should only take gold and silver for services.


"Hard assets", ya know.

merehuman's picture

the one on the left has calculator eyes. She can see the size of your wallet from anywhere

Client 9's picture

Why is that?  Because she is pretty and the only reason she would pay attention to someone like you is if you tried to buy her affection?

Pathetic judgements.  Well done Nouriel. On multiple fronts.

wretch's picture

I see no inconsistency here.  There's no reason why doom and hotties cannot mix.  What the fuck is wrong with you?

goldmiddelfinger's picture

I'm down wit tha sickness. Party like Dr Strangelove!

"Doctor, you mentioned the ration of ten women to each man. Now, wouldn't that necessitate the abandonment of the so called monogamous sexual relationship, I mean, as far as men were concerned?"
"Regrettably, yes. But it is, you know, a sacrifice required for the future of the human race. I hasten to add that since each man will be required to do prodigious... service along these lines, the women will have to be selected for their sexual characteristics which will have to be of a highly stimulating nature"
        - General Buck Turgidson & Dr Strangelove

Cdad's picture


Robo's problem is that his entire notion of wisdom is a 12 month chart of something that has already happened, or pictures of breats.  Well, that is the short answer, anyway.


merehuman's picture

i'll take a dozen breasts.

Captain Courageous's picture


When it all really goes to hell, who doesn't want to wind up in a bunker somewhere with a couple of happy kittens giving you a tongue bath?

grunk's picture

You're only getting a tongue bath as long as they're getting Kitten Chow or Fancy Feast. If not, you're looking at cat scratch fever.


akak's picture

I don't know how far Count Chocula's "gloom and doom" actually extends --- he is still insisting that gold reaching $1500 is "impossible".  Not unlikely, not far-fetched, but actually "impossible".  I have a feeling that the "impossible" is going to overtake Count Chocula's reality before very long.

Client 9's picture

I agree with his gold prediction and his taste in women.

Client 9's picture

I agree with his gold prediction and his taste in women.

Saxxon's picture

Perhaps he has the $1,500 price correlated somehow with the price of crude around $100; at which point, some might figure, demand would begin to break down.  I find his stance on $1,500 puzzling.

NotApplicable's picture

And he did it with an adjustable rate mortgage with a 5 year reset?!?! So I wonder if he knows that the New & Improved Fanniefreddiestein is going to be setup to hand out sweetheart deals for the politically connected?

Welcome to Bizarro World.

UncleFester's picture

No, he's just putting your money where his mouth is.  He spelled it out in plain english. 

1) Buy now, housing rcovers, sell before the reset, make bank.

2) Buy now, prices freefall, turn in the keys and walk away.

Even if #2 occurs, he had a sweet pad to live in for a couple of years.  I Fester.

andybev01's picture

Oh, that's what he meant be 'double-dip'.

rosiescenario's picture

...looks like money well spent....

eatthebanksters's picture

Robo, if you're so bullish on the markets and housing, then buy, baby, buy!  The Fed capitulated on housing last week when the report by their two analysts came out admitting they had made a mistake by supporting the TBTF banks.   $4 trillion in loan mods two years ago would have set a floor on the housing market and things would be so much rosier...unfortunately the banksters couldn't profit from that idea so they figured out how to move $20 trillion or so all over the place so this would be a record year for bonuses.  When the guvmnt starts cutting social welfare  and entitlement programs, don't say I didn't warn you when the people who got fucked start using bankers for target practice, French Revolution style.

THE DORK OF CORK's picture

Nah , me thinks he is preparing for a currency collapse......

and may I add, he has excellent taste.

Salinger's picture

right on ROBO -- he is a one trick pony who kept hidden his financial and business relationship with Larry Summers all through the crisis



FoieGras's picture

"Mr. Broken Clock" Roubini. When will this guy realize his 5 minutes of fame are up?

mberry8870's picture

As soon as you stop talking about him.

Cdad's picture


Who cares about Roubini, economists, or the economy?  What do we need that stuff for?  Ben Bernank prints money, criminal syndicate Wall Street bankers sell their STBX notes for Bernanke bananas, they use them to buy the Roach Motel [SPY], and that is that.  This is all we need now.

Get up to speed, man.  The economy does not matter, and neither do economists.  Please, fix your gaze upon fictional forward earnings expectations set by criminal syndicate Wall Street bankers so that you can buy the Roach Motel more quietly.

Thank you.

Boilermaker's picture IYR and it's components finish up another fine day massively outperforming the broader market and continue it's march upward after hours.


They'll do the same shit with this as they did with the financials.  They'll shove your shorts and puts right back in-yo-face.  They couldn't give a shit less how blatant it is.  The bazooka will be inserted into your rump and fired.

bugfixx's picture

A strange game. The only way to win is not to play.

Cortez's picture

I have a house I use once a week to go bowling.  Maybe I should join a bowling league near my current place and sell or rent that house.

Dr. Doom's picture

Economic double-dip not far behind