Roubini: U.S. economy will disappoint in 2014
Nouriel Roubini, the economist famous for predicting the financial crisis, says it is unlikely wages will pick up in 2014.
FORTUNE -- Dr. Doom is back, sort of.
Nouriel Roubini, the New York University economist who is famous for having predicted the housing bust and financial crisis, said on Friday that 2014 will be another disappointing year for the U.S. economy. Roubini is actually a bit more optimistic about the U.S. than he has been in previous years. But as the outlook has improved, and the stagnation in Washington has lessened a bit, other economists have upped their economic prognoses.
As a result, Roubini once again thinks the consensus has gotten ahead of itself.
Instead, the NYU economist says growth will pick up, but not enough to produce raises for average American workers. That will limit Americans' ability to shop and pay down debt, two things the economy needs for sustained growth. At the same time, corporate earnings are slowing. And while stocks aren't in a bubble, Roubini says they now look expensive. What's more, he says the U.S. may not get as much of a boost from its growing energy supply in 2014 as many think.
"The question is whether we have gotten to sustainable growth that is not based on bubbles," says Roubini. "Not yet."
Roubini made his comments at a breakfast event hosted on Friday by Time Inc. The conversation, which also included the Eurasia Group's Ian Bremmer, was moderated by Time's Rana Foroohar (who had her own take on the discussion).
Bremmer agreed that economists have gotten ahead of themselves. But he says the main risks in 2014 will be political, not economic. His biggest concern is that the Obama Administration's foreign policy agenda appears to be less ambitious in the president's second term. And he says the revelations from Edward Snowden have hurt the U.S. overseas.
He's very correct. There are no wage gains in most of the PRODUCTIVE part of the US Economy. Private Sector workers are if anything getting POORER since the 2008 Finan. Crash. All the increased purchasing power and wealth is the Govern. Sectors giving themselves raises (govern. workers and politicians, and their clientelle Dem. Party's Welfare Parasites off USA). Wash DC based govern. workers and NY Govern. Workers and Welfare Parasites have all had about 20% raises since 2008. Priv. Industry Taxpayers have seen incomes go down, even before further lost purchasing power for inflation, since 2008.