DUBAI: Ongoing political and macroeconomic uncertainties will continue to have a negative impact on the global economy and markets, economist Nouriel Roubini said on Tuesday at an investment conference in Dubai.
Roubini, who is known as Dr. Doom for his pessimistic forecasts, including predicting the credit crisis before 2007, said while some of the risks of outright deflation and double dip recession have diminished, the global economy will continue to face pressures.
“There are many positives in the global economy but significant uncertainties still remain,” Roubini said. “For the next few years, we will be living in a world where these uncertainties may have a negative impact on the economy and financial markets.”
He added that corporate balance sheets in advanced economies are in better shape than two years ago, which could propel companies to deploy some of their excess cash globally if global uncertainties were to wane.
Roubini, an economics professor at New York University , recently said spikes in energy prices related to wars or conflict in the Middle East preceded three of the last five global recessions.
Portugal will take an international bailout and Spain may be next as Madrid has underestimated the cost of cleaning up Spain’s financial system, Roubini said last November.
Roubini is also a board member in a $1.45 billion fund raised by billionaire Nicolas Berggruen’s Justice Holdings . The fund counts hedge fund manager William Ackman among investors.