Roubini told us so

That would be NYU Prof. Nouriel Roubini, who has predicted with confounding accuracy that the markets will keep going down. Earlier in the week, before today's carnage, this is what he wrote on his RGE Web site:

A cacophony of delusional bulls – including allegedly savvy investors such as the Sage of Omaha and other luminaries – were spinning for the last month the fairy tale that markets – especially equity markets – had fallen so much that a bottom had been reached and that this was the time to start buying equities. Some of us never believed this self-serving spin and warned repeatedly that both equity markets and credit markets had further severe downside risks (20% to 30% lower for equities).

Here's the really distressing part: Stocks are falling further and faster than even Roubini had projected!

In early October I predicted – in an interview for Tech Ticker – that the Dow could fall towards the 7000 level by next year and that US equities would fall by 50% relative to their 2007 peak. Such predictions were considered too bearish and extreme at that time but, at the rate at which equities are falling now with this acceleration of a savage deleveraging by leveraged institutions (and even disorderly sell-off by many unlevered players too), the Dow may reach the 7000 before year end rather than in 2009 and we are getting close to a 50% drop in overall equity prices from their peak.

Today’s close on the Dow was 7552. We can reach 7000 by tomorrow afternoon – easily.