by Angela Monaghan, The Telegraph:
Nouriel Roubini, the economist who famously predicted the financial crisis, said he is sticking to his view that the global economy is on course for a “perfect storm” next year.
Mr Roubini, the New York University professor dubbed “Dr Doom”, said a number of unpleasant factors would combine to derail the global economy in 2013, including an escalation of the eurozone crisis.
Other factors included further tax increases and spending cuts in the US that may drive the world’s largest economy into recession; a hard landing for China’s economy; a further slowdown in emerging markets; and war with Iran.
“Next year is the time when the can becomes too big to kick it down [the road]…then we have a global perfect storm,” he told Reuters.
Following a flat year this year, he said US markets could be in store for sharp falls next years, with the Federal Reserve powerless to stop it.
“There might be a weak rally because people are being cheered by more quantitative easing by [Chairman Ben] Bernanke and the Fed, but if the economy is weakening, that is going to put downward pressure on earnings growth,” he said.
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