Talk is cheap that the U.S. is merely in slow-growth mode more than two years after the official end to the recession, says economist Nouriel Roubini.
The U.S. may already be in a recession, says Roubini, the New York University professor who predicted the collapse of the U.S. housing market and predicted the 2008 recession. Known in some circles as Dr. Doom, Roubini says the U.S. just won't admit the nation is in a recession.
He also said the international economic recovery is reaching stall speed and a free fall can't be ruled out.
Speaking at an investment conference in Johannesburg, South Africa, on Wednesday, Roubini -- known for his bleak forecasts -- also predicted that leading global economies will not be insulated from effects of another global financial meltdown like the one that crippled the world in 2008, with impact still rippling more than two-and-a-half years later.
He said impact from the 2008 financial crisis is still being felt and that the recession effectively did not end, with lingering results as the situation only continues to get worse without a paternalistic figure to step up and negotiate a way forward.
He said a disorderly default for a Eurozone country could set in motion a series of events that set off a domino effect that tips the rest of the world into recession.
Roubini also predicted that developed economies are more likely to contract in the coming months than expand.
These shocks are going to keep on occurring, Ruobini said. Thinking the problems of the Eurozone are going to go away is delusional. ... The risk is actually that there is going be deceleration and the beginning of an economic contraction.
He warned that China was not immune to global events and that impact there, considering the fact that China has driven global growth in the past couple of years, could hasten global recession.
Some countries need to engage in fiscal austerity, said Roubini, in the press conference. We need lower interest rates in Europe. We need to lower the value of the euro. We need more fiscal resources. We need three times as much resources in Italy and Spain.
Roubini also predicted that the U.S. and other countries will face protests and unrest over growing economic inequality.
As we go into another recession, there will be unrest in the U.S., Roubini said.