Monday, February 1, 2010

Roubini: We Are in Trouble, U.S. Growth is Dismal, Unemployment to Rise

Professor Nouriel Roubini said in Davos this weekend that the U.S. growth outlook remains very dismal in spite of the great looking GDP figure released last Friday.

“The headline number will look large and big, but actually when you dissect it, it’s very dismal and poor,” “I think we are in trouble.”

He added than more than half of the growth was related to a replenishing of depleted inventories and that consumption was reliant on monetary and fiscal stimulus. As these naturally decline in 2010 the rate will slow to 1.5%in the second half of the year.

Unemployment To Rise

He says now that while the U.S. will not back into recession, U.S. unemployment will rise from the current 10%.

“It’s going to feel like a recession even if technically we’re not going to be in a recession,”

Bloomberg article.

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