Financial bubbles are very similar to other manias like those involving witches, the Crusades, etc, well-documented in the 1852 classic, 'Extraordinary Popular Delusions and the Madness of Crowds' . We, humans, are prone to all kinds of manias, plus, I think America has been especially prone to manias like with celebrities, the dot.com bubble, Harry Potter Books, Ipods, holiday shopping sales where crowds run over other shoppers, excessive debt, etc, etc. I found it particularly interesting that the book went into a mania involving fortune tellers.
So, Sharon Begley's recent article in Newsweek made me think that guys like Nouriel Roubini, Peter Schiff, etc - were nothing more than a current form of 'fortune tellers' and how a mania-predisposed society, like ours, especially during times of extreme uncertainty, just comes up with another mania - looking to people who are certain about what lies ahead - a current incarnation of fortune tellers - just because they might have made one great prediction is certainly no indication that they might make another - but it is their 'certainty' about the future which is the really dangerous thing about them and which mania-predisposed people are most likely to exhalt.
Bertrand Russell once wrote something like 'the problem with the world is that fools are certain and the intelligent are full of doubt'.
So, I think it wise to be extra wary of financial pundits who are so certain about what will happen with this financial mess. It would be safer to place a heavier weight on analysts who have more nuanced expectations, maybe even ones who suggest percentages about various things which might happen - like 15% chance of Depression, 50% chance of severe recession, and ranges like unemployment peaking between 15%-20% lasting 2-3 years, for example. Plus, a good analyst would be likely to also mention the positive things happening, especially since some positive things are indeed happening now, which would caution against relying too much on pundits with only worst-case scenarios.
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