‘dr. Doom’ says ‘World War III has already effectively begun’
Nouriel Roubini is tired of being called Dr Doom. He would prefer Dr. Realist.
But in an interview published Friday in the German publication The Spiegel, he has done little to dispel the feeling of doom that seems to follow him everywhere. Roubini, who predicted the 2008 housing crisis and subsequent financial crisis, is an economics professor at New York University and author of the new MegaThreats: Ten Dangerous Trends Jeopardizing Our Future and How to Survive Them.
In the The Spiegel interview, Roubini spoke of Iran and Israel on a collision course, fears that NATO could be drawn into war in Ukraine, and the Biden administration expecting “China to attack Taiwan as soon as possible”. He added: “Honestly, WWIII has already effectively started, certainly in Ukraine and in cyberspace.”
His comments follow Igor Sechin, head of Russian oil giant Rosneft and one of Russian President Vladimir Putin’s top allies, saying on Thursday that “Taiwan’s return to its home port” was “on schedule”. US attempts to create its own advanced microchip industry showed this, he added.
If China attacks Taiwan
Roubini also underlined the importance of Taiwan’s computer chip industry: “Imagine the impact of a Chinese attack on Taiwan, which produces 50% of all semiconductors in the world and 80% of of range. It would be a global shock. We are more dependent on semiconductors today than oil.
US Secretary of State Antony Blinken recently said Beijing has become “determined to pursue reunification” with Taiwan “in a much faster time frame”, rather than “sticking to the status quo”.
This month, Chinese leader Xi Jinping, at the two-decade-long Chinese Communist Party Congress, won a third term, consolidated his power and declared that his nation’s right to use force on Taiwan does not would never be given up.
He has also promoted loyalist generals to a central military commission where he ‘cannot afford any dissent’ if he wants to pull the trigger in Taiwan,” Singapore-based strategic adviser Alexander Neill told Voice of America. .
“To get any advantage they would have to move fast, really fast,” Neill said. “There is no room for dithering. This has always been Chinese thinking on Taiwan, and the Ukrainian standoff confirmed the need to avoid getting bogged down in a slow logistical buildup.
A “bad recession”
Of course, the war in Ukraine and a possible clash with Taiwan are just some of Roubini’s concerns, as the title of his book suggests.
While political leaders “have to deal with Russia and Ukraine before they deal with Iran and Israel or China,” he said. The Spiegel“Policymakers should also think about inflation and recessions, ie stagflation.”
Roubini recently said that any claims of a soft landing for the economy at this point are “delusional”.
“We are going to have a bad recession, a bad stagflation and another serious financial crisis. I think that’s the baseline,” he told Bloomberg. odd lots podcast this month.
Central banks, he argued, don’t have good options at this point. They can continue to raise interest rates to fight inflation, or they can “crash” and cut rates for fear of a recession.
“Unfortunately, at this point, damned if you do, damned if you don’t,” Roubini said. “There is no easy way out. If you fight inflation, you’re going to have a recession and a financial crisis. And if you don’t fight inflation, you’re going to have inflation unanchoring and you’ll have stagflation and always a financial crisis.
He predicts “massive insolvencies and cascading financial crises” around the world in the coming years, as he wrote in a New York Times editorial this month.
Does he have anything positive to say? Yes. Investing in Midwest real estate is a smart move. Much of the United States, after all, will be underwater or unlivable due to heat, drought, wildfires or other devastation caused by climate change.
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