Applauding balanced arguments about the global economic crisis.

Unwittingly, when tripping across the web site of Gluskin Sheff, as reported on this Blog earlier the full extent of David Rosenburg’s background hadn’t been clear.  As well as being Gluskin’s Chief Economist & Strategist, David was previously Chief North American Economist for Merrill Lynch, so this guy is no slouch.  Here is DR’s short bio as it appears on the Gluskin web site.

David A. Rosenberg is Chief Economist & Strategist with a focus on providing a top-down perspective to the Firm’s investment process. Mr. Rosenberg has earned both Bachelor of Arts and Master of Arts degrees in Economics from the University of Toronto. Prior to joining Gluskin Sheff, David was Chief North American Economist at Bank of America-Merrill Lynch in New York and prior thereto, he was a Senior Economist at BMO Nesbitt Burns and Bank of Nova Scotia. Mr. Rosenberg has ranked first in economics in the Brendan Wood International Survey for Canada for the past seven years and was on the U.S. Institutional Investor All American All Star Team for the last four years. He ranked second overall in the
2008 survey.

The free reports that one can subscribe to on the Gluskin Sheff web site are excellent.

In David’s report of the 31st July, Breakfast with Dave, he speaks about how difficult it really is to say that this is both the end of the recession and the start of the recovery.

The end of the recession and the onset of a sustainable recovery, as we saw in 2002, are not the same thing. So this could still end badly but we will await confirmation signs that this is more than a very flashy bear market rally before shifting gears. As we said in our Tea session yesterday, the cost of missing out on the first leg of a bull market, between the lows in the major averages and the lows in employment, is 20% — the price to pay to sleep at night. If we are late, and we do not intend on being too late or staying excessively bearish, we will know once the most important component of the business cycle, the engine that keeps the motor turned on, otherwise known as employment, begins to turn around on a discernible basis. We shall wait for that event, then make up our minds, and if this is the real deal, which at this time seems unlikely in the context of an ongoing credit contraction, then we will at least have 80% of the bull market to participate in … that is, if historical experience can be used as a guide.

The problem that this layman has (and I bet that I am not alone in this) is that one doesn’t have the competencies to challenge the propositions of people as expect as Rosenburg.  We need other experts to do that on our behalf.  Proper balanced reporting seems to be so difficult to obtain, especially in the main-stream media, that when there is a coherent alternative view put forward it has to be applauded and promoted.  Hence this Post.

David Rosenburg’s full report, as referred to above, may be obtained here. (Note you will have to previously open an account with Gluskin.  This is free and much recommended.)

Read it and then visit Seeking Alpha and read the response from John Lounsbury (John B. Lounsbury Ph.D., CFP is a financial planner and investment advisor in Clayton, NC. and also writes a Blog WordPress, of course!)

Well done, David and John, us laymen desperately need this quality of debate.

By Paul Handover

• Finance