Gary Shilling

Last updated

Gary Shilling
A. Gary Shilling Image.jpg
Born (1937-05-25) May 25, 1937 (age 87) [1]
Fremont, Ohio, United States [2]
Education
Occupation(s)financial analyst and commentator
Notable work“The Housing Bubble Will Probably Burst” (January 2006)

A. Gary Shilling (born May 25, 1937) is an American financial analyst and commentator who appears regularly in publications such as Forbes , The New York Times , and The Wall Street Journal . He is president of A. Gary Shilling & Co., Inc., editor of A. Gary Shilling's Insight, and a member of the Nihon Keizai Shimbun Board of Economists. [3] [4] He is featured frequently on business shows on radio and television, and as a recognised orator, addresses conventions of global business groups like the Young Presidents' Organization. More than two years before the housing bubble burst, Shilling warned that subprime loans were probably "the greatest financial problem" for the future U.S. economy, and in January 2006, prior to the 2008 recession, he wrote an article entitled: “The Housing Bubble Will Probably Burst”. In 2007 he correctly prophesied that housing would "sink the economy".

Contents

Biography

Shilling was awarded a bachelor's degree in physics from Amherst College, and an MA and PhD in economics from Stanford University. [1] He has worked for Thornhill Securities, the Federal Reserve Bank of San Francisco, Merrill Lynch, White Weld & Co., and Standard Oil Co NJ. [5]

In the spring of 1969, he was one of only a few analysts who correctly envisioned the recession at year's-end, [4] and was almost a lone voice in 1973, when he forecast a monolithic international inventory-building fling, followed by the first significant recession since the Great Depression.

In the late 1970s, while most analysts presumed that waxing inflation would go on unabated, Shilling was the first to predict that America's infirm political climate would impede it. [6] He also foresaw various dangerous economic readjustment problems and a shift in investment strategy from a preference for tangible assets to an increased emphasis on stocks and bonds. He was named Top Commodity Trading Advisor by Futures Magazine in 1993 and Wall Street Top Economist (1975 and 1976) by Institutional Investor Magazine . [1]

More than two years before the housing bubble burst, Shilling warned that subprime loans were probably "the greatest financial problem" for the future U.S. economy, and in January 2006, prior to the 2008 recession, he wrote an article entitled: “The Housing Bubble Will Probably Burst” in A. Gary Shilling's Insight. [7] [8] In 2007 he correctly prophesied that housing would "sink the economy". [8]

In June 2011, he predicted a 20% drop in housing in 2012 with a resulting global recession. [9] In October 2012 he predicted a global recession in 2013. [10]

In August 2015, he predicted that the price of oil "is headed for $10 to $20 per barrel" (it was $43/barrel at the time) due to higher productivity through fracking and OPEC not limiting production. [11]

Related Research Articles

In economics, a recession is a business cycle contraction that occurs when there is a period of broad decline in economic activity. Recessions generally occur when there is a widespread drop in spending. This may be triggered by various events, such as a financial crisis, an external trade shock, an adverse supply shock, the bursting of an economic bubble, or a large-scale anthropogenic or natural disaster. But there is no official definition of a recession, according to the IMF.

<span class="mw-page-title-main">Nouriel Roubini</span> Iranian-American economist

Nouriel Roubini is a Turkish-born Iranian-American economic consultant, economist, speaker and writer. He is a Professor Emeritus since 2021 at the Stern School of Business of New York University.

<span class="mw-page-title-main">2000s United States housing bubble</span> Economic bubble

The 2000s United States housing bubble or house price boom or 2000shousing cycle was a sharp run up and subsequent collapse of house asset prices affecting over half of the U.S. states. In many regions a real estate bubble, it was the impetus for the subprime mortgage crisis. Housing prices peaked in early 2006, started to decline in 2006 and 2007, and reached new lows in 2011. On December 30, 2008, the Case–Shiller home price index reported the largest price drop in its history. The credit crisis resulting from the bursting of the housing bubble is an important cause of the Great Recession in the United States.

A financial crisis is any of a broad variety of situations in which some financial assets suddenly lose a large part of their nominal value. In the 19th and early 20th centuries, many financial crises were associated with banking panics, and many recessions coincided with these panics. Other situations that are often called financial crises include stock market crashes and the bursting of other financial bubbles, currency crises, and sovereign defaults. Financial crises directly result in a loss of paper wealth but do not necessarily result in significant changes in the real economy.

In statistics, a forecast error is the difference between the actual or real and the predicted or forecast value of a time series or any other phenomenon of interest. Since the forecast error is derived from the same scale of data, comparisons between the forecast errors of different series can only be made when the series are on the same scale.

<span class="mw-page-title-main">Subprime mortgage crisis</span> 2007 mortgage crisis in the United States

The American subprime mortgage crisis was a multinational financial crisis that occurred between 2007 and 2010 that contributed to the 2007–2008 global financial crisis. The crisis led to a severe economic recession, with millions losing their jobs and many businesses going bankrupt. The U.S. government intervened with a series of measures to stabilize the financial system, including the Troubled Asset Relief Program (TARP) and the American Recovery and Reinvestment Act (ARRA).

<span class="mw-page-title-main">Robert J. Shiller</span> American economist (born 1946)

Robert James Shiller is an American economist, academic, and author. As of 2022, he served as a Sterling Professor of Economics at Yale University and is a fellow at the Yale School of Management's International Center for Finance. Shiller has been a research associate of the National Bureau of Economic Research (NBER) since 1980, was vice president of the American Economic Association in 2005, its president-elect for 2016, and president of the Eastern Economic Association for 2006–2007. He is also the co‑founder and chief economist of the investment management firm MacroMarkets LLC.

United States housing prices experienced a major market correction after the housing bubble that peaked in early 2006. Prices of real estate then adjusted downwards in late 2006, causing a loss of market liquidity and subprime defaults.

<span class="mw-page-title-main">Causes of the 2000s United States housing bubble</span>

Observers and analysts have attributed the reasons for the 2001–2006 housing bubble and its 2007–10 collapse in the United States to "everyone from home buyers to Wall Street, mortgage brokers to Alan Greenspan". Other factors that are named include "Mortgage underwriters, investment banks, rating agencies, and investors", "low mortgage interest rates, low short-term interest rates, relaxed standards for mortgage loans, and irrational exuberance" Politicians in both the Democratic and Republican political parties have been cited for "pushing to keep derivatives unregulated" and "with rare exceptions" giving Fannie Mae and Freddie Mac "unwavering support".

<span class="mw-page-title-main">Great Recession</span> Global economic decline from 2007 to 2009

The Great Recession was a period of market decline in economies around the world that occurred in 2007 to 2009. The scale and timing of the recession varied from country to country. At the time, the International Monetary Fund (IMF) concluded that it was the most severe economic and financial meltdown since the Great Depression.

<span class="mw-page-title-main">Chinese economic stimulus program</span> Government Plan

The 2008–09 Chinese economic stimulus plan was a RMB¥ 4 trillion stimulus package aiming to minimize the impact of the Great Recession on the economy of China. It was announced by the State Council of the People's Republic of China on 9 November 2008. The economic stimulus plan was seen as a success: While China's economic growth fell to almost 6% by the end of 2008, it had recovered to over 10% by in mid-2009. Critics of China's stimulus package have blamed it for causing a surge in Chinese debt since 2009, particularly among local governments and state-owned enterprises. The World Bank subsequently went on to recommend similar public works spending campaigns to western governments experiencing the effects of the Great Recession, but the US and EU instead decided to pursue long-term policies of quantitative easing.

<span class="mw-page-title-main">Mark Zandi</span> American economist (born 1959)

Mark M. Zandi is an American economist who is the chief economist of Moody's Analytics, where he directs economic research.

<span class="mw-page-title-main">United States bear market of 2007–2009</span> 17-month bear market

The US bear market of 2007–2009 was a 17-month bear market that lasted from October 9, 2007 to March 9, 2009, during the financial crisis of 2007–2009. The S&P 500 lost approximately 50% of its value, but the duration of this bear market was just below average.

John R. Talbott is an American finance expert, author, commentator, and political analyst. He is known for having predicted national and international economic crises in the past decade.

<span class="mw-page-title-main">Causes of the Great Recession</span>

Many factors directly and indirectly serve as the causes of the Great Recession that started in 2008 with the US subprime mortgage crisis. The major causes of the initial subprime mortgage crisis and the following recession include lax lending standards contributing to the real-estate bubbles that have since burst; U.S. government housing policies; and limited regulation of non-depository financial institutions. Once the recession began, various responses were attempted with different degrees of success. These included fiscal policies of governments; monetary policies of central banks; measures designed to help indebted consumers refinance their mortgage debt; and inconsistent approaches used by nations to bail out troubled banking industries and private bondholders, assuming private debt burdens or socializing losses.

<span class="mw-page-title-main">2007–2008 financial crisis</span> Worldwide economic crisis

The 2007–2008 financial crisis, or the global financial crisis (GFC), was the most severe worldwide economic crisis since the Great Depression. Predatory lending in the form of subprime mortgages targeting low-income homebuyers, excessive risk-taking by global financial institutions, a continuous buildup of toxic assets within banks, and the bursting of the United States housing bubble culminated in a "perfect storm", which led to the Great Recession.

Med Jones is an American economist. He is the president of International Institute of Management, a U.S. based research organization. His work at the institute focuses on economic, investment, and business strategies.

Jeremy James Siegel is an American economist who is the Russell E. Palmer Professor of Finance at the Wharton School of the University of Pennsylvania. He appears regularly on networks including CNN, CNBC and NPR, and writes regular columns for Kiplinger's Personal Finance and Yahoo! Finance. Siegel's paradox is named after him.

<span class="mw-page-title-main">COVID-19 recession</span> Economic downturn, primarily due to the COVID-19 pandemic

The COVID-19 recession was a global economic recession caused by COVID-19 lockdowns. The recession began in most countries in February 2020. After a year of global economic slowdown that saw stagnation of economic growth and consumer activity, the COVID-19 lockdowns and other precautions taken in early 2020 drove the global economy into crisis. Within seven months, every advanced economy had fallen to recession.

References

  1. 1 2 3 Shilling, A. Gary (March 2, 1988). After the Crash: Recession Or Depression? Business and Investment Strategies for a Deflationary World. Lakeview Economic Services & Publishing. ISBN   9780961856236 via Google Books.
  2. "Be Careful What You Ask For by Gary Shilling". m.smallbusinessadvocate.com.
  3. "A. Gary Shilling & Co., Inc". A. Gary Shilling & Co., Inc.
  4. 1 2 "Gary Shilling - CNBC". www.cnbc.com. April 4, 2012.
  5. "Gary Shilling Bio". www.cfaboston.org.
  6. "A. Gary Shilling Biography | Booking Info for Speaking Engagements".
  7. How To Prosper In The Changing Real Estate Market
  8. 1 2 "Global Recession: Only Time Can Heal the Economy, Says Gary Shilling". finance.yahoo.com. August 13, 2012.
  9. "20% Drop in Housing to Cause Recession in 2012, Says Gary Shilling". finance.yahoo.com. July 13, 2011.
  10. "Global Recession Ahead in 2013: Time to Get Out of Stocks, Says Gary Shilling". finance.yahoo.com. October 18, 2012.
  11. "Here's Why Supply and Demand Means $30 Oil". August 14, 2015 via www.bloomberg.com.