Roubini: Economic Recovery To Be 'Very Ugly'

CNBC:

Nouriel Roubini, the economist whose dire forecasts earned him the nickname "Doctor Doom", told CNBC Monday that the economic recovery is going to be "very ugly."

"The recovery is going to be subpar," Roubini said. "I see a one percent growth in the economy in the next few years. There will also be 11 percent unemployment next year and the recovery is going to be slow. It's going to feel like a recession even when it ends."

Read the whole story: CNBC

Comments

[DamaskinosWasRight]

If we want to crank up the economy there are several options:

1) We can eliminate the National Debt the same way we pumped up the banks - by printing the money. Printing money is a bad thing because it can lead to inflation but in a recessionary economy that is not a risk. That window is closing so the time to act is now:

http://corporate-statesmen.com/images/FAST_2009_NATIONAL_DEBT_SOLUTION.pdf

2) We can implement Levelist policies to eliminate the advantage other countries gain through lower wages and lower ecological standards.

http://corporate-statesmen.com/images/LEVELISM.pdf

3) We can put the budget on the path to balance for perpetuity by implementing autobalance fiscal policy.

http://corporate-statesmen.com/images/AUTOBALANCE.pdf

et al: http://corporate-statesmen.com/policiesandinitiatives.html

Perhaps Roubini does not expect aggressive policy initiatives?

[pomegrante]

PhilipTaylor,I am a big fan of yours!!!

[ScreenName05]

Roubini is unfortunately right. The only question is if the U.S. will ever pull out, or will we become a second world debtor nation?

We either invest in us - the U.S. - or we drift slowly into second world status. That means investing in education, infrastructure, and getting off foreign oil. It means cutting the military and handouts to big corporations. It means fixing health care. It likely means overturning NAFTA and a lot of other treaties that have sent jobs overseas. It means buying American, even when it costs more. It means punishing businesses and individuals who off shore their profits to avoid paying their fair share of taxes.

It means a lot. It is why we voted for President Obama!

[norkas]

There will be another trillion dollar plus written off by the banks because of the high end houses they are holding on to. They have not written down these homes correctly and at the year end you will see something unreal take place and that is the high end housing market go down another 50% aleast.

The reason is that in the $800,000 and up specualtion was going crazy. With no money down or 10% the very wealthy also got into the habit of buying and fliping homes. Today when you buy a expensive home you have to put down real money and that means25% and up because banks are looking at worse case today and do not want to be stuck.

We can no longer continue importing everthing from China or this economy will be broght to its knees. Solar power panels and factories have to be made in America and companies have to have incentives from the gobernment because we can not be sucessful being a purchasing nation only.

We are not close to being out of the woods yet but when green jobs start kicking in we must have made in America and the unions cannot put them out of business as they have done in the past

[BurtonOerney]

We're all aware that Nouriel Roubini was a treasury official under Clinton. He was senior advisor to Tim Geithner there. He likes globalization and has worked at the IMF. Here's what he said when approached to work in the Obama administration:

"When I was in government, every word I said in public, I had to clear it with general counsel," Roubini says. "I prefer to be a free thinker and be able to write daily without having to worry about that."

This, even though he was predicting global disaster and claimed to have a cure for it. Maybe they didn't offer him enough money. Roubini always predicts collapse and disaster. He has been right in a big way twice: the asian collapse in 1997-8 and this collapse. Since recessions generally hit every five years, that's not super surprising.


Some other things he predicted: this crisis would immediately collapse the dollar;

hurricane Katrina would bring about immediate financial collapse;

filling the holes in bank balance sheets would not unfreeze the commercial paper market and that intra-bank lending would collapse completely;

if we didn't nationalize the banks, not only would none of them pay back the $700 billion (this was in February) but we'd need to give them $1-$1.5 trillion more.


People don't mind if you predict bad things and good things happen instead. Coach used to do that to Sam on Cheers. Remember that? Coach swore by that system.

[Unrepentant]

Nice analysis, thanks. I remember most of it as you do.

[TruthHasSpoken]

Haha couldn't agree with you more...Also we are in bear season so every doom prophet gets recognition..I do agree with Roubini that the recovery will be slow but not as extreme as his proposing. It might just stay flat for a while. So the consumer can deleverage while the future economy tries to take its form, which might not be consumer related. Then again something exciting can enter the market and could immediately change the consumer psyche.

[rblaquinta]

Roubini will never be heard from again ... when the recession ends...poor gloomy and doomy...he has all those young babes hanging on him...he will be all alone in the world!!!! Flavor of the month will fade away!!!

[olephart]

Wall Street has sucked the Government dry. The team of Geithner and Summers has emptied the Treasury into their vaults. This has been the greatest financial heist in history. The prevailing dim witted view offered by the business media is that once Wall Street is fixed we can go back to the good times of fleecing widows and orphans and living beyond our means on borrowed monies. Indeed many of Obama's policies infer that. The bailouts, stimulus, mortgage redos and foreclosure abatements are all designed to pump air into back into the balloon.

What they won't admit is that the economy has failed. Our earnings have been propped up by irresponsible tax cuts for both the rich and middle income Americans. The years of the constant feeding frenzy of the MIC has drained trillions from the Treasury. While other countries get health care, income security and infrastructure we get F-22s, wars and a military empire. This final spend your house for lack of income debacle has pulled the plug.

Nothing has changed in the past six months. Obama and the Fed are doing now what has always been done except this time it isn't working. Even at zero per cent interest people aren't borrowing because they are broke and in debt. Bernanke is pushing on a rope. The only thing keeping us afloat is Government's borrowing. When the engine doesn't start, our credit will dry up and that is when the feces hits the air handling device.

[BurtonOerney]

I don't understand what you want. You are upset up there at the top because bailouts lead to people borrowing and living beyond their means and then you're upset down there at the bottom because people aren't getting loans fast enough.

[olephart]

The bailouts were tantamount to reimbursing drug lords if their boatload of cocaine sunk. Note the word heist, or phrase emptied the Treasury. Further, it is dim witted to want people to live beyond their means. This led to the economy failing. Also, this is what they are still trying to do and it won’t work because people are broke. Obama et. al. are repeating the same things over an over expecting different results. This is defined as insanity.

[leduck]

What recovery?
Right now the recession is just getting worse much more slowly

[totaldisbelief]

not that slowly.

[jazzman]

"It's going to feel like a recession even when it ends."

Let's be honest folks didn't it feel like a recession about 3 years before the official recession started? The average citizen has known that we've been in a declining economy for a long time. Long before the official start of the recession in late 2007.

[RJII]

yep.

[totaldisbelief]

yup

[barakagirl]

the FED is the problem. How come these guys are never audited? who owns them?
PEOPLE DO THE RESEARCH! it doesn't matter who's president the country is own by bankers...
Unless we refuse to subjugate ourselves and our kids to this, there is no hope. It's beyond Obama is really about corporatists vs people with the FED giving the marching orders through monetary supply manipulations.

The FED can never lose and no one knows what it does. The FED has no reserves to back the dollar (except forcing other nations to buy it) it uses fractional reserve banking and that's an unsustainable way of growing an economy.
Sooner or later the dollar will be worth nothing and all our property will be taken by these guys as we work more and more for ever less.... basically the return of Slavery: no Healthcare, no job security, just debt!!!
It's time to review this monatery system who has only helped the corrupt and greedy bankers...

[totaldisbelief]

how dare you talk about a criminal organization like that !

[polkadotpoodle]

poodles are not well versed in ecnomics...however, the demise of labor and the middle class and the unions began with St. Ronnie RayGun. And, Mr. "I did not have sex with that woman" helped destroy labor and manufacturing with NAFTA. Poodles pee on Shubs and really can't bring ourselves to speak of the atrocities of the last 8 years. some very nice person above indicated the politicians really don't have much to do with what happens in the country.....who elects the folks at Goldman Sachs? Are they Christian? Where do they stand on gay rights, abortion and the right to arm bears?

[jazzman]

The logic of NAFTA played out exactly like the naysayers said it would. The upside of NAFTA promised by politicians never materialized.

Where would we be now if we had not had NAFTA? Better paying jobs. Better benefits. A stronger manufacturing base. Employment that lasts more than a couple of years. A strong retirement program. Products that are well made.

NAFTA and the WTO have been a total bust but now we're married and for the U.S. that has been hollowed out it means a bleak future unless we do something like create a whole new economy like Obama is trying to do.

[totaldisbelief]

and who profited by the passage of NAFTA and who does the WTO serve?
Disaster Capitalism isn't patriotic and knows no nationality.

[norgotoad]

Hear! Hear!! Even the government is aggressively outsourcing via "contractors." How about that? I work in Calfornia and 34 billion dollars (per a very detailed study) are services sent to "outside contractors." They, in turn, contract with India or China outsourcing operations(e.g., TATA Consulting, et al.) to outsource billions to India. I know this because I work in IT for the state, and have seen it first hand on three separate occasions. And the work is 20+ years obsolete for top dollar!! So we have a state that is in the red to the tune of 26 billion. It outsources 34 billion (20 + billion of which is sent to India via subcontracting returning ZERO back in taxes due to biz write offs and subsidies per NAFTA). All the while we have double digit unemployment, severe cutting of education, health care, highway and bridge maintenance, corrections, law enforcement and fire fighting services. So while India is getting richer, healthier, and smarter, we're getting poorer, sicker and dumber. I confronted a lawmaker with this during a so-called town hall meeting, and was told that outsourcing "will not even be considered" and "it is off the table." Cutting services and jobs is what is "on the table" and we the taxpayer and citizen are ON THE MENU. NAFTA and WTO are being served up hot every day even in government. Bona petit.

[lillibelle]

Exactly so. Who could forget those Gore - Perot debates when Ross warned us all about "that big sucking sound" while Gore smugly looked on. I don't understand why these trade agreements are not being redrawn. You say "we're married" to them. Maybe it's time for a separation?

[bobh]

The recession seems to be ending about now, and that is well before Roubini thought it would occur.
Many of the big banks have returned to health, and that is not something he would have predicted. If he is forecasting 1% growth, then it will probably be 2%. He has no credibility with me anymore.

[bascombe]

I want some of what bobh is taking. until then, I guess I'll settle for rose-tinted glasses.

[FROG1]

LOL ain't that the truth? what country is he living in? this 'recession' is merely in introduction to the new american way of life that will get worse and not get better - mismanaged by marx*st f*scists, this country is doomed. I have moved to Canada because of it.

[markm8128]

LOL!
The only reason "some of the big banks have returned to health" is because they have been recieving massive government bailouts. If it had been left to the "Magic of the Market" our entire banking system would have collapse by now.

[totaldisbelief]

what planet are you dialing in from?

[motherfather]

Wrong!

[WonderingNThinking]

I think Roubini is being optimistic to ensure he can stay in the mainstream media to at least get some of the truth out there.

[Lilith33]

This is a coup.Wake up america.....

[totaldisbelief]

right now the loudest sound in America is zzzzzzzzzzzzzzzzzzzzzzzzzzzzz..

[Tom Walker]

Up until the 1960s, unions advocated for shorter working time as a remedy for unemployment. The shorter day was the founding philosophy of the American Federation of Labor. In the wake of the Great Depression, full employment became a central policy goal of the federal government. At first, economic growth was touted as the surest path to full employment. So economic growth became the means for achieving full employment. But in the 1970s, full employment was criticized by Milton Friedman as inflationary. So non-inflationary economic growth became the goal instead of the means. Meanwhile, the unions had jumped on the "economic growth as a means for achieving full employment" bandwagon.

The only way to get back to having a dialog about full employment is for the unions to get back to their traditional advocacy of the shorter day and the shorter week.

[Lilith33]

The unions will be gone shortly.

[bascombe]

they can't do it while jobs are being shipped overseas. the race to the bottom continues, unabated.

[FROG1]

time to disband the unions - no place for them

[totaldisbelief]

do you use your head for more than a place to put your hat ?

[DBtv]

Reality is your friend, get in touch with him.

[totaldisbelief]

I hate to say it but; what's left of the Unions is almost irrelevant .

[norgotoad]

Well said. Unionization was denigrated by Reagan (the great Union buster). He and his corporate cronies made off like fat rats, and the country bought his snake oil of using credit in lieu of pay raises, and 401k/ IRAs in lieu of solid traditional retirement plans (that have shown to be superior to "playing the market"). Most in America had delusions of becoming rich, but that assumed fair odds at rigged game. Delusions are nice, but reality-- as a schizo patient I had put it after jumping off the Golden Gate Bridge-- "will eventually hit you." Belief in the cowboy "free market" run by kindly fairies is a nice delusion. But in the casino known as Wall Street, the house ALWAYS wins. Just ask Goldman Sachs and AIG. Unions and collective bargaining are the ONLY ways to even the playing field a little bit. Unfortunately, Americans are too dumb and gullible to figure that out.

[Weathermaker]

Bloomberg:

U.S. Rescue May Reach $23.7 Trillion

http://www.bloomberg.com/apps/news?pid=20601087&sid=aY0tX8UysIaM

----

What's a trillion these days...

[PhilipTaylor]

TIME TO AUDIT THE FED Reserve SYSTEM!

Time for Timmy Geithner and his companions Summers and Bernanke to RETIRE from Service to the Wall Street Banks including their Government and FAKE Government FED jobs!

We will NOT MISS THEM!

They agreed to go under the bus for the Wall Street Gang!

Now is the TIME!

Audit the FED if you want to see REAL Deceit! It will curl you Hail and your toes!

Ask about the Maiden Lane "Vehicles" and how much the Banks took and at what interest rates from them!

[bascombe]

there needs to be some mobolization.