The Prime of Mr. Nouriel Roubini

Roubini was far from the only person to go on television and point out that the world's financial emperor had no clothes. Morgan Stanley economist Stephen Roach, former Oppenheimer analyst Meredith Whitney, and investment advisers like Gary Shilling, Peter Schiff, and Marc Faber questioned the conventional wisdom during the boom years. What distinguishes Roubini from the others, at least in part, is his persistent attention to the business of publicity.

Roubini is widely known for the speed with which he returns reporters' emails, and he is loath to pass up a media opportunity, no matter how early in the morning or late in the evening his presence is requested. Roubini, though, tells me that these days he actually turns down 95 percent of his interview requests. "Honestly, I never call anybody, but when CNBC and Bloomberg-literally, every week, several times a week-say, 'Come on our show,' there is no way we can say, 'I'm not going to do it.' Right?"

Nouriel Roubini's thoughts about the economy in October 2008.
The fact that RGE has a sophisticated (and free) online component increases Roubini's profile. By aggregating material from other economics bloggers, he ensures that those commentators will, in turn, both link to RGE and mention Roubini's posts and his other work in their own writings. Roubini also Twitters: "Nouriel is having fun at the Google After Hours party in Davos after a day of wonkdom"; "Nouriel has an op-ed on how to control Systemic Risk in the Financial Times today."

Roubini turned his website and consulting into a more organized business three and a half years ago. Backed by notable investors, including William Janeway, a managing director at Warburg Pincus LLC, and Arminio Fraga, the former president of Brazil's central bank, Roubini set up an office above a Manhattan Mini Storage facility a few blocks from his loft. From that one room, RGE has since expanded to seven locations. The Hong Kong and London offices opened last year, and Roubini hopes to launch RGE outposts in Frankfurt, Singapore, Moscow, and Dubai by the end of 2009.

"We would be delusional if we thought we were growing because of anything but Nouriel's notoriety," says RGE chief executive officer Dean Daniels. "His predictions are what open the door."

Among the firm's new clients is billionaire investor Ronald Perelman, who first contacted Roubini after watching him on Charlie Rose last year. Perelman was so impressed with Roubini's performance that he asked him to meet with him and other members of his company. "I'm crazy about him. I think he's very smart, very direct," Perelman says, adding that Roubini's advice has caused him to back off from making certain investments, at least in the short term. "I think he is one of the brightest, the most effective economists that I've ever met, certainly that I've ever dealt with."

Perelman, another man-about-town who catches his share of tabloid flak, met up with Roubini on St. Barts and hung out with him during a recent vacation. Perelman says he plans to ask Roubini to one of his famous Shabbat dinners. But he has yet to attend one of Roubini's loft parties and had to turn down a recent invitation.

RGE's site, called Roubini Global Monitor, combines aggregated and original content in a way that's similar to the Huffington Post. Analysts hired by RGE parse data on economic and political conditions in every area of the world. In addition, RGE has about 250 bloggers and analysts who contribute to the site. Some material is available by subscription only; clients include hedge funds, think tanks, and even the World Bank, RGE says. Subscription prices range from $10,000, for "reading rights," to more than $100,000, which includes personal meetings and consultations with Roubini or his staff. But with Roubini's views so well known, why would anyone pay to become a client? "In many ways, I tell them the same things I'm telling the public," Roubini acknowledges, but he adds that he and his team flesh out arguments for clients and give them the time and attention they need.

Just back from Davos, Roubini meets me again at the Algonquin Hotel. This time he orders a $15 glass of pinot noir. The Davos conference, where shell-shocked finance executives treated him like a rock star, was but one stop in a three-week global jaunt. "Zurich, Moscow, London, Istanbul, Abu Dhabi, you name it," he says. Earlier, despite putting in a full day at RGE, he managed to find time to meet with five different publishers about writing a book on the economic crisis.

Even sitting down, Roubini can't stop moving-pulling his hair, tugging at his ear, shifting his position. He leaves at 8:30 to return to his NYU office and answer emails, but he's planning to quit at 11 to meet friends for dinner. And he's still trying to decide if he should have a party in his loft the following evening. At 4:12 a.m., he sends out a Twitter linking to a Bloomberg article on an International Monetary Fund report claiming that many advanced economies are already in a depression. He says his doctor has told him that he's endangering his health by sleeping only three or four hours a night. It isn't that he can't sleep, he says. It's just impossible for him to accomplish everything he wants to in a conventional workday of 8 or 10 or 12 hours.

At the moment, Roubini's level of influence is probably as great as it ever will be. When he announced at a conference in Dubai-a few hours before Barack Obama's inauguration-that he believed global losses in the credit crisis could top $3.6 trillion, the U.S. stock market promptly plunged. Britain's Telegraph claimed the economist's comments were partly responsible for intensifying the losses.

It wasn't the first time. During an October speech in London, Roubini predicted that stock markets in the U.S. and other countries would soon have to shut down for as long as a week to end the rash of panic selling. The forecast went viral immediately. The next day, a number of world markets suffered severe drops, and futures on U.S. markets fell so far that trading in them was halted. The Big Picture, Barry Ritholtz's popular financial blog, posted a guide to how the New York Stock Exchange's circuit breakers work and what sort of drop would be needed to close the market for the day. Ritholtz says the post was a coincidence and not a response to Roubini's predictions that the market would have to shut down.

The U.S. stock market ultimately rallied the following week, but Roubini suspects that there could have been some sort of government intervention. "You started low, and instead of falling more, it rallied like crazy. I think that the Treasury might have made such a call," he says. "It was way too strange to be market dynamics." It sounds like conspiracy-theory talk, the sort of chatter one might hear on late-night talk radio, except that other people started saying similar things: Scott Nations, president of Fortress Trading, went on CNBC a few weeks later to make a similar charge, though he claimed the government intervention occurred on different days.

Such controversy only fuels the Roubini publicity machine, which needs to be running in full gear to keep up with the growing competition among celebrity doom-mongers. Nassim Taleb, the famously dour author of The Black Swan, recently said on Charlie Rose's show, "I think it's worse than Roubini thinks. I have the same story." Taleb, who met Roubini for the first time earlier this year, says he meant no rivalry by his comments. "When this crisis was evolving, he was the only economist who made sense," Taleb says. "I have enormous respect for him, and if you know me, I don't have respect for a lot of people." The two recently joined forces to set up (predictably) a Facebook group called Make Bankers Accountable, which encourages banking executives to return bonuses received in previous years.

Roubini says he does not want to be known only for his bearish views. But when I ask what it will take for him to see a positive future for the economy, he has a hard time answering. When I press him, he says consumption is key; it will be triggered by job stability and income growth. He has become an outspoken advocate of temporarily nationalizing insolvent banks, saying any other solution is simply prolonging the U.S.'s fiscal agony. Roubini actually thinks the recession could, according to official indicators, end by December. But he maintains that we are in for a weak recovery, one in which companies will continue to shed jobs for at least a year after the economy begins to grow.

He still continues to use the "Doctor Doom" sobriquet in his Facebook status updates and lists it prominently in his bio on the website of the company that books his speaking engagements. "It's a nice nickname," he says. "But I tell you, the day when we reach the bottom, I'll be the first one to call in and say Doctor Doom has become Doctor Boom. I'm not a permabear."
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