Roubini: Global Slowdown Not "Just a Soft Patch"

[cieldumort]

CNBC
Chance of Another Round of Easing by Year-End: Roubini

There is a chance the U.S. Federal Reserve could unleash another round of quantitative easing by the end of the year, according to renowned economist Nouriel Roubini.

In an interview with CNBC on Saturday, the head of Roubini Global Economics said the probability of QE3 will become “significantly higher” if U.S. economic weakness persists and the stock markets correct 10 percent or more.

“Especially because we cannot do another round of fiscal stimulus, the pressure is going to be on the only policy that is available, [that] is another round of quantitative easing,” he said.

Roubini, who correctly predicted the financial crisis that began in 2008, is especially concerned about the myriad problems the U.S. economy currently faces.

“You have the problems of rising oil prices, of [a] weak labor market, of housing double dipping, the fiscal problem in the state and local government, the facts of the federal deficit problem,” he said. “All these things imply that economic weakness could persist in the second half of the year.”

Roubini believes the current slowdown in global growth is not “just a soft patch,” and the biggest risk to the financial markets comes from the troubled euro zone economies...