Clouds Over 2022

Although major economies and markets fared well in 2021 despite all of the uncertainties surrounding new variants of the coronavirus, 2022 will bring new challenges. In addition to central banks shifting toward policy normalization, geopolitical and systemic risks are multiplying. NEW YORK – Despite dips and disruptions from new variants of COVID-19, 2021 turned out … Continue reading “Clouds Over 2022”

Why Italy’s Presidential Election Matters

By Nouriel Roubini, Brunello Rosa With its poor track record of managing EU funds, Italy’s recovery plan will be a major test for the future of EU policymaking more generally. While it is widely agreed that Prime Minister Mario Draghi must remain on the scene to oversee the plan’s implementation, in what capacity would he … Continue reading “Why Italy’s Presidential Election Matters”

What South Africa Must Do

NOURIEL ROUBINI, COLIN COLEMAN Locked in a low-growth trap, South Africa’s fiscal and macroeconomic situation is unsustainable, not only economically but also politically. To salvage the country’s democratic project, the government must offer a credible, comprehensive economic reform strategy. NEW YORK – South Africa is at a crossroads. To save its democratic project, it needs to … Continue reading “What South Africa Must Do”

The Stagflation Threat Is Real

There is a growing consensus that the US economy’s inflationary pressures and growth challenges are attributable largely to temporary supply bottlenecks that will be alleviated in due course. But there are plenty of reasons to think the optimists will be disappointed. NEW YORK – I have been warning for several months that the current mix of persistently … Continue reading “The Stagflation Threat Is Real”

Biden’s Neo-Populist Economic Doctrine

Within the space of just half a year, US President Joe Biden has completed a necessary economic-policy regime shift that started chaotically under his predecessor. But while the Biden administration has a much better handle on the issues, that doesn’t mean the new dispensation will be without risk. NEW YORK – About half a year … Continue reading “Biden’s Neo-Populist Economic Doctrine”

The Looming Stagflationary Debt Crisis

Years of ultra-loose fiscal and monetary policies have put the global economy on track for a slow-motion train wreck in the coming years. When the crash comes, the stagflation of the 1970s will be combined with the spiraling debt crises of the post-2008 era, leaving major central banks in an impossible position. NEW YORK – … Continue reading “The Looming Stagflationary Debt Crisis”

Leaders and Laggards in the Post-Pandemic Recovery

While some major economies are recovering fast from the pandemic-induced recession, others are languishing, and still others remain in a state of acute crisis. The extent to which these global inequalities persist will depend on a range of factors, and will have profound implications for social, political, and geopolitical stability. NEW YORK – After the … Continue reading “Leaders and Laggards in the Post-Pandemic Recovery”

Is Stagflation Coming?

Lost in the debate over whether today’s ultra-loose fiscal and monetary policies will trigger painful inflation is the broader risk posed by potential negative supply shocks. From trade wars and de-globalization to aging populations and populist politics, there is no shortage of inflationary threats on the horizon. NEW YORK – There is a growing debate … Continue reading “Is Stagflation Coming?”

Nouriel Roubini: bitcoin is not a hedge against tail risk

The writer is a professor of economics at the Stern School of Business, NYU, and host of Elon Musk may be buying it, but that doesn’t mean everyone else should follow suit Claims that bitcoin is the new “digital gold” are feeding a new bubble in it and other cryptocurrencies. The last one in … Continue reading “Nouriel Roubini: bitcoin is not a hedge against tail risk”

America Is the New Center of Global Instability

Following the storming of the US Capitol, President Donald Trump is desperate for an exit ramp that will preserve both his fragile ego and his future political influence. Unfortunately, that conundrum leaves him with few options other than to foment even more chaos both at home and abroad. NEW YORK – Whether the storming of … Continue reading “America Is the New Center of Global Instability”

A Fragile Recovery in 2021

Although 2020 ended with a flurry of announcements reporting promising results in COVID-19 vaccine trials, there is little reason to expect a robust economic recovery anytime soon. Defeating the virus remains a monumental task, and the wounds inflicted by the pandemic will not heal easily. NEW YORK – By the end of 2020, financial markets … Continue reading “A Fragile Recovery in 2021”

The US Election’s Chaos Quotient

While hoping for a conclusive outcome on November 3 (or immediately thereafter), market watchers unfortunately must prepare for the worst. After all, US President Donald Trump and the Republicans are not even hiding their plans to steal the election. NEW YORK – Opinion polls in the United States have long pointed to the strong possibility of a … Continue reading “The US Election’s Chaos Quotient”

Why Biden Is Better Than Trump for the Economy

The presumption that Republicans are better than Democrats at economic stewardship is a longstanding myth that must be debunked. For all Americans who care about their and their children’s future, the right choice this November could not be clearer. NEW YORK – Joe Biden has consistently held a wide polling lead over US President Donald Trump ahead … Continue reading “Why Biden Is Better Than Trump for the Economy”

Is the Almighty Dollar Slipping?

Far from signaling its imminent demise as the main global reserve currency, the greenback’s sharp depreciation is to be expected in the current macroeconomic context. The forces that could erode the dollar’s hegemony remain slower-moving and farther off. NEW YORK – The recent sharp depreciation of the US dollar has led to concerns that it … Continue reading “Is the Almighty Dollar Slipping?”

Revisiting the White Swans of 2020

At the start of the year, when COVID-19 was barely on anyone’s radar outside of China, the global economy was entering a fraught phase, facing a range of potentially devastating tail risks. And though the pandemic has since turned the world on its head, all of these threats remain – and some have become more salient. … Continue reading “Revisiting the White Swans of 2020”

The Main Street Manifesto

The historic protests sweeping America were long overdue, not just as a response to racism and police violence, but also as a revolt against entrenched plutocracy. With a growing number of Americans falling into unemployment and economic insecurity, while major corporations take bailouts and slash labor costs, something had to give. NEW YORK – The … Continue reading “The Main Street Manifesto”

Europe’s Non-Hamiltonian Muddle

Although any joint EU action should be welcomed, the current COVID-19 response plan hardly amounts to a radical break with business as usual. Far from a long-awaited embrace of debt mutualization, the newly proposed European recovery fund risks being both politically unpalatable and economically inadequate. NEW YORK – This past week, the European Commission unveiled … Continue reading “Europe’s Non-Hamiltonian Muddle”

The Coming Greater Depression of the 2020s

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. NEW YORK – After the … Continue reading “The Coming Greater Depression of the 2020s”

The White Swans of 2020

Financial markets remain blissfully in denial of the many predictable global crises that could come to a head this year, particularly in the months before the US presidential election. In addition to the increasingly obvious risks associated with climate change, at least four countries want to destabilize the US from within. NEW YORK – In … Continue reading “The White Swans of 2020”

Trump Will Make China Great Again

Despite the latest Sino-American “skinny deal” to ease tensions over trade, technology, and other issues, it is now clear that the world’s two largest economies have entered a new era of sustained competition. How the relationship will evolve depends greatly on America’s political leadership – which does not bode well. NEW YORK – Financial markets … Continue reading “Trump Will Make China Great Again”

Why Financial Markets’ New Exuberance Is Irrational

Owing to a recent easing of both Sino-American tensions and monetary policies, many investors seem to be betting on another era of expansion for the global economy. But they would do well to remember that the fundamental risks to growth remain, and are actually getting worse. NEW YORK – This past May and August, escalations … Continue reading “Why Financial Markets’ New Exuberance Is Irrational”

The Allure and Limits of Monetized Fiscal Deficits

With the global economy experiencing a synchronized slowdown, any number of tail risks could bring on an outright recession. When that happens, policymakers will almost certainly pursue some form of central-bank-financed stimulus, regardless of whether the situation calls for it. NEW YORK – A cloud of gloom hovered over the International Monetary Fund’s annual meeting … Continue reading “The Allure and Limits of Monetized Fiscal Deficits”

Four Collision Courses for the Global Economy

Between US President Donald Trump’s zero-sum disputes with China and Iran, UK Prime Minister Boris Johnson’s brinkmanship with Parliament and the European Union, and Argentina’s likely return to Peronist populism, the fate of the global economy is balancing on a knife edge. Any of these scenarios could lead to a crisis with rapid spillover effects. … Continue reading “Four Collision Courses for the Global Economy”

The Anatomy of the Coming Recession

Unlike the 2008 global financial crisis, which was mostly a large negative aggregate demand shock, the next recession is likely to be caused by permanent negative supply shocks from the Sino-American trade and technology war. And trying to undo the damage through never-ending monetary and fiscal stimulus will not be an option. NEW YORK – … Continue reading “The Anatomy of the Coming Recession”

The Great Crypto Heist

Cryptocurrencies have given rise to an entire new criminal industry, comprising unregulated offshore exchanges, paid propagandists, and an army of scammers looking to fleece retail investors. Yet, despite the overwhelming evidence of rampant fraud and abuse, financial regulators and law-enforcement agencies remain asleep at the wheel. NEW YORK – There is a good reason why … Continue reading “The Great Crypto Heist”