Emerging Markets & The Risk to The World Economy | NOURIEL ROUBINI BLOG

Tuesday, February 25, 2014

Emerging Markets & The Risk to The World Economy

How big of a risk to the world economy are the troubles we’ve seen in emerging markets recently?

Nouriel Roubini : I was in a panel in plenary session about emerging markets, and I said that I think what happened last year might repeat itself this year. You still have, on the one side, concerns about the Chinese economic slowdown, there are concerns about how fast the Fed tapers and raises interest rates, commodities prices are becoming softer, many of these countries have not done structural reforms, and many of them have a lot of fragility, have lax monetary credit and fiscal policy.
And now there is a layer of political uncertainty, with the “Fragile Five” having parliamentary or presidential elections: India, Indonesia, Turkey, Brazil, South Africa. There’s also additional political uncertainty coming from other places like Ukraine, places like Argentina, places like Thailand, that affects markets.
So what happened this week was a bit of a mini perfect storm between Chinese PMI of 50, Argentina letting its currency go, noises coming politically from Ukraine, Turkey, and Thailand … so the contagion is not just within emerging markets but also affects advanced economies’ equity markets. - in Business Insider Australia

Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics

Nouriel Roubini, (born March 29, 1958, Istanbul, Turkey), Turkish-born American economist and educator who was best known for predicting the 2007–08 subprime mortgage crisis in the United States and the subsequent global financial crisis.

Born to Iranian Jewish parents, Roubini moved with his family to Iran and Israel before they settled in Italy in 1962. After a year at Hebrew University of Jerusalem, he studied economics at Bocconi University in Milan (B.A., 1982) and Harvard University (Ph.D., 1988), where he specialized in macroeconomics and international economics. He joined the economics faculty at Yale University in 1988 and taught there until 1995, when he moved to New York University. He also served as a visiting scholar to the International Monetary Fund (IMF), was a research associate with the National Bureau of Economic Research (NBER), held single-year terms on the White House Council of Economic Advisers (1998–99) and at the U.S. Department of the Treasury (1999–2000), and cofounded (2004) the consulting firm Roubini Global Economics. Roubini spent much of his early career studying countries that experienced extreme economic failures, such as Mexico (in 1994), Thailand and other countries associated with the 1997 Asian financial crisis, Russia (1998), and Argentina (2000). He determined that each shared one common element: a massive current account deficit.(www.britannica.com)

Nouriel Roubini is the Chairman and CEO of Roubini Macro Associates, LLC, his own global macroeconomic consultancy firm. He is also a professor of economics at New York University’s Stern School of Business. Dr. Roubini has extensive policy experience as well as broad academic credentials. From 1998 to 2000, he served as the senior economist for international affairs on the White House Council of Economic Advisors and then the senior advisor to the undersecretary for international affairs at the U.S. Treasury Department, helping to resolve the Asian and global financial crises, among other issues. The International Monetary Fund, the World Bank and numerous other prominent public and private institutions have drawn upon his consulting expertise.