In October 2006, Nouriel Roubini predicted that a housing crash in the U.S. could trigger a recession and “hard landing” around the world. The economist, known as “Dr. Doom,” continued to warn of impending worldwide threats during the following decade and a half.
In an interview with Yahoo Finance’s editor-in-chief on Monday for the All Markets Summit, Roubini outlined imminent risks around the globe that he also details in his new book, “MegaThreats: Ten Dangerous Trends That Imperil Our Future, And How to Survive Them.” These dangers include what he calls a cold war between the U.S. and China that could turn hot; inflation combined with debt instability; and climate change; among other perils.
“Right now, we’re facing major mega threats: monetary, social, political, geopolitical, environmental, health, trade, and technology,” Roubini said. “Unless we address them, we’re headed towards disaster.”
The economist spoke at length about the perils of inflation, which soared 8.2% year-over-year in September — far above the Federal Reserve’s 2% target. The inflationary environment has stirred up memories of the so-called Great Inflation of the 1970s, which led to inflation peaking at 14% in 1980. The so-called Great Moderation ensued, with relatively stable prices in the following decades.
“In the book, what I find out is that the era of great moderation, where growth was okay, inflation low, 2%, is over,” Roubini told Yahoo Finance on Monday. “Now we’re going to an era of what I call great stagflationary [a stagnant economy combined with inflation] and debt instability and crisis.”
Due to his often bleak outlook, Roubini is also known as “Dr. Doom.” But Roubini says his book is a call to action against serious threats to the world.
“I usually say that I’m Dr. Realist, not Dr. Doom,” Roubini remarked. “I think warning about the risk is very important because until now we’ve been kicking the can down the road.”
Dylan Croll is a reporter and researcher at Yahoo Finance. Follow him on Twitter at @CrollonPatrol.
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