Connect with us

Hi, what are you looking for?

Jewish Business News

Business

Economist Nouriel Roubini Warns of 2008 Level Financial Crash Coming Soon

Roubini, predicts a “train wreck” stock market crash and stagflation.

Nouriel Roubini The World Knowledge Forum YouTube

Nouriel Roubini, a world renowned economist, is worried that the world is about to suffer a global financial crisis to rival the one which came in 2008 after the sub-prime mortgage meltdown. The main problem, says Roubini, is the current rate of inflation. Roubini explained his concerns in a column published by Project Syndicate.

Nouriel Roubini was born in Turkey to Iranian Jewish parents in 1958. The Harvard educated economist teaches at New York University’s Stern School of Business and is chairman of Roubini Macro Associates LLC, an economic consultancy firm.

After the crash of 2008, Nouriel Roubini says that governments failed to deal with the underlying causes of the economic crisis and merely “kicked the can down the road.” This, he said, made another crisis inevitable. And now, says Roubini, that crisis has arrived and the risks are growing of a “train wreck” stock market crash and stagflation. He sees only a “U” shaped recovery, sending the economy back into the Covid recession later this year. Roubini expects a full on depression by the end of the decade.

Please help us out :
Will you offer us a hand? Every gift, regardless of size, fuels our future.
Your critical contribution enables us to maintain our independence from shareholders or wealthy owners, allowing us to keep up reporting without bias. It means we can continue to make Jewish Business News available to everyone.
You can support us for as little as $1 via PayPal at office@jewishbusinessnews.com.
Thank you.

“While there is never a good time for a pandemic, the COVID-19 crisis has arrived at a particularly bad moment for the global economy. The world has long been drifting into a perfect storm of financial, political, socioeconomic, and environmental risks, all of which are now growing even more acute.”

Roubini believes that the Covid crisis has shown the need for more public spending on health care overall. He calls this a “necessity” and not a “luxury.” And because of the aging populations in the developed world, such expenses for retiree’s healthcare will only grow in the future.

Another problem cited by Roubini, is what he sees as the growing risk of deflation. Deflations is when prices plummet due to lack of demand or over-production. So manufacturers lose money, and so they cut jobs, and this results in fewer peope who can afford their goods, thereby continuing a downward spiral into depression. This is exactly what happened at the start of the Great Depression.


Nouriel Roubini explains that, in addition to causing a deep recession, the crisis is also creating a “massive slack in goods (unused machines and capacity) and labor markets (mass unemployment), as well as driving a price collapse in commodities such as oil and industrial metals. That makes debt deflation likely, increasing the risk of insolvency.”

As for inflation, Nouriel Roubini told Yahoo Finance that he is, “on the side of those who believe that the rise in inflation is not going to be temporary, is going to be more persistent. We have a massive monetary and fiscal stimulus, much bigger and more protracted than we had after the global financial crisis.”

Saying that there will be continued inflation while at the same time that there is a risk of deflation is not contradictory. Deflation could very well follow a period of inflation.

Newsletter



Advertisement

You May Also Like

World News

In the 15th Nov 2015 edition of Israel’s good news, the highlights include:   ·         A new Israeli treatment brings hope to relapsed leukemia...

Entertainment

The Movie The Professional is what made Natalie Portman a Lolita.

Travel

After two decades without a rating system in Israel, at the end of 2012 an international tender for hotel rating was published.  Invited to place bids...

VC, Investments

You may not become a millionaire, but there is a lot to learn from George Soros.