Nouriel RoubiniWall Street loves its "contrarians." And the pundits who prevail in high-profile bets against the crowd can often parlay the fame into fortune as well. The reason for their outsize influence is understandable enough. Most investors assume that the big bet was the result of rare insight or a better understanding of events and latch on to these seers' future recommendations.

But investors should think twice before blindly following all their later proclamations. Indeed, going with the flow may sometimes be smarter than betting against the crowd. Rather than any profound insight, the contrarian pundit du jour may simply have a tendency to go out on a limb instead. And while their bold, correct calls tend to generate plenty of fanfare, their advice may generally fall short.

A study of economists, for example, found that those with a better record for predicting extreme events had a worse overall record, according to The Boston Globe.

"The analyst with the largest number as well as the highest proportion of accurate and extreme forecasts had, by far, the worst forecasting record," the authors wrote. While they tend to be celebrated as prophets, these high-profile analysts may be closer to one-hit wonders instead.

Twice as Often Wrong as Right

And there's no shortage of pundits who shot to fame on the back of a bold call only to come up empty afterwards. Take Meredith Whitney. The once-obscure banking analyst was among the first to warn of the financial crisis that was brewing even as most remained complacent. The boost was enough to allow Whitney to strike out on her own.

But her performance has been lackluster since. A Bloomberg analysis tallied her with only six accurate stock forecasts compared to 13 inaccurate ones as of the middle of last year. And she made the right call on only 37% of the 81-company S&P 500 Financials Index.

Whitney is now back in the headlines calling for a meltdown in the municipal bond market. But investors should keep in mind both the good and the bad calls when deciding how much credence to put in her latest forecast.

Whitney is far from the only pundit to be showered with accolades for calling the crisis only to stumble later. New York University economist Nouriel Roubini (pictured above) became a household name for forecasting the Great Recession while most others were whistling past the graveyard.

Ooops and Ooops Again

But he has had plenty of big misses since. In 2008, he predicted a major hedge fund meltdown that never materialized, The Boston Globe notes. He called for oil prices to stay below $40 during 2009 due to anemic demand but they spiked to $80 at the end of that year. Perhaps most notably, Rubini called for the S&P 500 to fall below 600 in the March of 2009. It surged 23.5% that year, the steepest gain since 2003, to close at 1,115.

Gluskin Scheff chief economist David Rosenberg was also early to sound the alarm on the financial crisis. But Rosenberg has taken plenty of flak for being far too bearish about the recovery since and continuing to forecast gloom.

And Peter Schiff of Europacific saw his star rise after predicting the crisis even as other pundits remained glib. But Schiff has been anything but prescient about the recovery. And despite an enormous body of evidence, he insists that the economy is in worse shape than in 2008 and on the verge of a depression because of government intervention.

Given the possible fame and fortune it can generate, going against the grain in a big way is a gamble that makes sense for plenty of aspiring pundits. Blindly following their subsequent advice, though, may not make sense for most investors.

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americandoo

AMERICAN'S IN AMERICA..ALL AMERICANS.. IT'S OK TO PREDICT WHAT'S GOING TO HAPPEN OR WHAT COULD HAPPEN..BUT..IT'S BETTER TO START DOING..THIS WHAT WILL.. MAKE IT HAPPEN ! !

"TIME FOR BIG INVESTORS TO STEP UP TO THE PLATE LEAD AMERICA BY INVESTING IN AMERICA"



"WHEN YOU INVEST IN AMERICA YOU INVEST IN YOUR CHILDREN'S FUTURE"

"INVEST IN A LARGE PROJECT THAT WILL MAKE A DIFFERENCE FOR THE FUTURE"

Similar to this idea;

In past history when the USA needed a Moral Boost to our Country we built such
things as;

The Largest Bridges, Dams, Statue Of Liberty, Worlds Largest Futuristic
Fair, Landed on the Moon etc. It is overdue for us and time for us to build the
Largest & Best Futuristic CITY IN THE WORLD, using ALL OF OUR CUTTING EDGE
TECHNOLOGY AND ALL OF CHINA'S, GERMANY, RUSSIA and all other Countries CUTTING
EDGE TECHNOLOGY and BEYOND ALL OTHERS ! !

We need to find a location in the USA somewhere that has the space for our
"FUTURE CITY PROJECT" where our Future City will Utilize all of the Newest and
Cutting edge combined technology in the world to build our City using entirely
GREEN energy with 0 pollution

Our City Could Have A NEW VERSION OF THE STATUE OF LIBERTY, Holding the torch
in one hand and our GREEN PLANET EARTH in her other hand, her head raised high
looking Up at the sky.

This would make a GREAT FILM & Could be based on a True Story with the help of A
TEAM OF BIG MONEY INVESTORS ! ! !

Use your Imagination and think how GREAT THIS WOULD BE FOR AMERICA & OUR
ECONOMY ! !

" COULD BE A HISTORICAL EVENT IN OUR HISTORY BOOKS FOR OUR NEXT GENERATION
TO FOLLOW"

"DREAM BIG...DO BIG"

Thank You, Respectfully, Michael V. Caldwell, Proud American
Inventor/Dreamer..Dream Big..Do Big ! ! !

January 20 2011 at 11:44 AM Report abuse rate up rate down Reply
americandoo

AMERICAN'S IN AMERICA..ALL AMERICANS.. IT'S OK TO PREDICT WHAT'S GOING TO HAPPEN OR WHAT COULD HAPPEN..BUT..IT'S BETTER TO START DOING..THIS WHAT WILL.. MAKE IT HAPPEN ! !

"TIME FOR BIG INVESTORS TO STEP UP TO THE PLATE LEAD AMERICA BY INVESTING IN AMERICA"



"WHEN YOU INVEST IN AMERICA YOU INVEST IN YOUR CHILDREN'S FUTURE"

"INVEST IN A LARGE PROJECT THAT WILL MAKE A DIFFERENCE FOR THE FUTURE"

Similar to this idea;

In past history when the USA needed a Moral Boost to our Country we built such
things as;

The Largest Bridges, Dams, Statue Of Liberty, Worlds Largest Futuristic
Fair, Landed on the Moon etc. It is overdue for us and time for us to build the
Largest & Best Futuristic CITY IN THE WORLD, using ALL OF OUR CUTTING EDGE
TECHNOLOGY AND ALL OF CHINA'S, GERMANY, RUSSIA and all other Countries CUTTING
EDGE TECHNOLOGY and BEYOND ALL OTHERS ! !

We need to find a location in the USA somewhere that has the space for our
"FUTURE CITY PROJECT" where our Future City will Utilize all of the Newest and
Cutting edge combined technology in the world to build our City using entirely
GREEN energy with 0 pollution

Our City Could Have A NEW VERSION OF THE STATUE OF LIBERTY, Holding the torch
in one hand and our GREEN PLANET EARTH in her other hand, her head raised high
looking Up at the sky.

This would make a GREAT FILM & Could be based on a True Story with the help of A
TEAM OF BIG MONEY INVESTORS ! ! !

Use your Imagination and think how GREAT THIS WOULD BE FOR AMERICA & OUR
ECONOMY ! !

" COULD BE A HISTORICAL EVENT IN OUR HISTORY BOOKS FOR OUR NEXT GENERATION
TO FOLLOW"

"DREAM BIG...DO BIG"

Thank You, Respectfully, Michael V. Caldwell, Proud American
Inventor/Dreamer..Dream Big..Do Big ! ! !

January 20 2011 at 11:44 AM Report abuse rate up rate down Reply
americandoo

AMERICAN'S IN AMERICA..ALL AMERICANS.. IT'S OK TO PREDICT WHAT'S GOING TO HAPPEN OR WHAT COULD HAPPEN..BUT..IT'S BETTER TO START DOING..THIS WHAT WILL.. MAKE IT HAPPEN ! !

"TIME FOR BIG INVESTORS TO STEP UP TO THE PLATE LEAD AMERICA BY INVESTING IN AMERICA"



"WHEN YOU INVEST IN AMERICA YOU INVEST IN YOUR CHILDREN'S FUTURE"

"INVEST IN A LARGE PROJECT THAT WILL MAKE A DIFFERENCE FOR THE FUTURE"

Similar to this idea;

In past history when the USA needed a Moral Boost to our Country we built such
things as;

The Largest Bridges, Dams, Statue Of Liberty, Worlds Largest Futuristic
Fair, Landed on the Moon etc. It is overdue for us and time for us to build the
Largest & Best Futuristic CITY IN THE WORLD, using ALL OF OUR CUTTING EDGE
TECHNOLOGY AND ALL OF CHINA'S, GERMANY, RUSSIA and all other Countries CUTTING
EDGE TECHNOLOGY and BEYOND ALL OTHERS ! !

We need to find a location in the USA somewhere that has the space for our
"FUTURE CITY PROJECT" where our Future City will Utilize all of the Newest and
Cutting edge combined technology in the world to build our City using entirely
GREEN energy with 0 pollution

Our City Could Have A NEW VERSION OF THE STATUE OF LIBERTY, Holding the torch
in one hand and our GREEN PLANET EARTH in her other hand, her head raised high
looking Up at the sky.

This would make a GREAT FILM & Could be based on a True Story with the help of A
TEAM OF BIG MONEY INVESTORS ! ! !

Use your Imagination and think how GREAT THIS WOULD BE FOR AMERICA & OUR
ECONOMY ! !

" COULD BE A HISTORICAL EVENT IN OUR HISTORY BOOKS FOR OUR NEXT GENERATION
TO FOLLOW"

"DREAM BIG...DO BIG"

Thank You, Respectfully, Michael V. Caldwell, Proud American
Inventor/Dreamer..Dream Big..Do Big ! ! !

January 20 2011 at 11:44 AM Report abuse rate up rate down Reply
americandoo

"THINKING OUT OF THE BOX TO STIMULATE AMERICA'S HOUSING MARKET & ECONOMY"

"A VERY VIABLE IDEA & DOOABLE IDEA ! ! ! ! ! "


Why Not Kill 4 Birds With One Stone..

BANKS THAT OWN FORECLOSURES WOULD INSTALL NEW SOLAR SYSTEMS ON FORECLOSED HOMES NATION WIDE.

THESE SOLAR SYSTEMS HAVE TO BE MADE IN THE USA & BE INSTALLED BY AMERICAN'S WHO ARE UNEMPLOYED AND HAVE BEEN RETRAINED TO INSTALL SOLAR SYSTEMS AND THEY WOULD HAVE TO BE WORKING FOR; LICENSED SOLAR CONTRACTORS.

This Program would be offered to HOME OWNERS WHO LOST THEIR HOMES AND HAD GOOD OR EXCELLENT CREDIT BEFORE THEY LOST THEIR HOMES & ALSO FOR FIRST TIME BUYERS ONLY ! !


Independent Appraisers who have no interest in these foreclosed homes could place a value on these homes before the installation of these systems, this would insure that the banks could not pad the Price of the homes and other guidelines would have to be put in place, but this could work to help Stimulate the Economy, be Great for the Environment, Home Buyer's & Banks. "A WIN WIN FOR ALL"


1. This would give Investors and private individuals an extra incentive to buy
these homes thus stimulating the housing economy instantly.

2. This would put more Americans Back to work manufacturing more solar systems.

3. This would cut down on Pollution.

4. This would save money for the owners buying these homes on utilities.

Due to the initial expense of solar systems part of the cost would be added to the home loan, part would be paid by the bank and the government would give the

bank and the homeowner a tax break or whatever details that would be needed to work this out for everyone ! ! THINK POSITIVE THINK AMERICANDOO ! !

This IDEA could be duplicated World Wide putting AMERICA BACK ON THE FAST TRACK.. LEADING THE WAY AGAIN IN NEW INNOVATIVE IDEAS TO STIMULATE THE ECONOMY, PUT UNEMPLOYED TO WORK & HELP OUR ENVIRONMENT AT THE SAME TIME ! ! WINNER WINNER CHICKEN DINNER ! !


Thank You Respectfully, Michael V Caldwell, Always Striving To Be Part Of The Solution Using Respect, Common Sense & Ameri-Can Do Attitude ! !

January 20 2011 at 10:51 AM Report abuse rate up rate down Reply
Sonny

Just be patient Mr. Kumar..........you will need plenty of salt and pepper and other spices when it comes time to eat your words!

January 19 2011 at 6:03 PM Report abuse +1 rate up rate down Reply
sgentilejr

To:Vishesh Kumar
You said that___Peter Schiff of Europacific saw his star rise after predicting the crisis even as other pundits remained glib. But Schiff has been anything but prescient about the recovery. And despite an enormous body of evidence, he insists that the economy is in worse shape than in 2008 and on the verge of a depression because of government intervention.
________________________________________________________________________________
Vishesh____Mr. Schiff is 100% correct. The economy is actually far worse now than in 2008 or at it's low point in Feb/March 2009. The reasons why: The number of banks failing is INCREASING and the number of banks on the Troubled banks list is still growing while the FDIC insurance pool is empty. The number of Foreclosures is growing and once the banks get all their Clear Title paper work in order Foreclosures will grow even faster. 2011 will be worse than 2008, 2009 or 2010 because SS payments are frozen for the second year___as are Civil Service pensions, railroad pensions, military pensions, VA disability and Federal OWCP disability and Federal wages. The reduction in the SS taxes will reduce SS funding while SS payments are growing, which adds to the deficits.
Our nation CANNOT and WILL NOT have any growth when so many incomes have been frozen and when the Federal and States and City government are on a path of CUTTING and More Cutting. Mr. Vishesh you and many like you "just don't get it and you probaby never will" but Cutting means LESS___not more___ LESS jobs and LESS growth ahead.
The only thing that has kept the USA afloat thus far was the Life Raft created by the Bush Bailouts and the continued Obama Stimulus spending. Now that has ended and there is nothing left in their bag of tricks to keep the Life Raft afloat.
Mr. Vishesh Kumar I suggest you check past history___the stock market recovered also after the 1929 Crash for about 13 months before it began a long downward slide again____ that lasted to 25 years. Sir there will be no real recovery until after the year 2020 at the Earliest and probably not until after the year 2030. Unfortunately the vast majority of us Baby Boomers have to die off first to lower pension, SS and medical, nursing home costs first before the nation can recover. Until such time we will be leaving a flood of empty homes and our vacation condos in our wake that no one who needs them can actually afford them.

January 19 2011 at 11:19 AM Report abuse +1 rate up rate down Reply
chase5300

No one, not even a psychic could have imagined the STUPIDITY of our elected officials to dig an even DEEPER debt hole than the one that CAUSED the crisis to begin with. Why don't we just print up another 18 billion dollars, since that seemed to fix everything?
If the Fed and Treasury are right, then everything they tought me in college was a waste of time (I have an MBA). Why even TEACH economics!??!!

January 19 2011 at 9:43 AM Report abuse +1 rate up rate down Reply
Robert & Lisa

Evil, ultra rich man George Soros is trying to take over America.

January 19 2011 at 7:17 AM Report abuse +2 rate up rate down Reply
ultraz2

Bullcrap I have a friend that called the downturn 18 months before it happened. These guys have nothing on his ability. He called every step of the downturn prior to it happening. He was 100 percent correct.

January 18 2011 at 9:20 PM Report abuse +1 rate up rate down Reply
Lawrence

See This ?...It's the Gravy Train...See me on the Gravy Train as it pulls out of the Station...See me wave to anyone left behind...Whoo, Whoo..

January 18 2011 at 6:58 PM Report abuse rate up rate down Reply