Storm alert for world economies: Change of Times not Times of Change

Russian TV: A perfect storm – such is the general economic forecast from leading global institutions and experts. The US recession and eurozone turmoil coupled with disruptions in the global corporate credit market are expected to stress-test the globe soon.

Nothing but a chain of financial shocks and break-ups lie ahead for Europe and the world’s economic locomotive, the US, says “Dr. Doom” – professor Nouriel Roubini, who predicted the start of the current economic crisis.

A military conflict in Iran, as well as a slowdown in emerging economies, especially in China, will fan the flames, Roubini added.“You put it together — the eurozone troubles with the US slowdown, China…you could have a train wreck next year,”he said.

Greece will become the first to restructure and quit the eurozone, and countries with similar problems will follow suit, Roubini told CNBC, noting that Spain will become the next victim, losing market access by the end of 2012. Furthermore, in a “domino effect” the fiscal problems in Greece, Portugal and Spain will spread to the global economy, Dr. Doom warned.

In the US, Dr. Doom expects the stock market to plunge further, with the Standard and Poor’s 500 going down to 1,300 by the end of the year from its current standing of 1,357.99. Economic growth is likely to be fragile and isn’t expected to go above 2% in 2012, the professor concluded.


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