Keeping to his nickname of “Dr. Doom” after he foretold of
the 2008 financial crisis, economist Nouriel Roubini told marketwatch he expects the U.S. to fall off the fiscal
cliff. Referring to the combination of
tax hikes and spending cuts facing the U.S. on Jan. 1 under current federal
law, Roubini said “I think there’s a highly likely chance we’re going to go
over the cliff.”
But it won’t be all bad, said Roubini, a professor of
economics at New York University and chairman of Roubini Global Economics. “If we do so, the market reaction is going to
force the two sides to reach an agreement,” he said in an interview on
Bloomberg TV.
Switching back to his gloomy ways, Roubini added that even
with an agreement on Capitol Hill, the U.S. will face a roughly 1.4% headwind
on gross domestic product related to fiscal and tax policy surrounding the
fiscal cliff. But even with that
hardship, Roubini admitted the U.S. is
faring better than other nations….
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