There’s a reason they call him Dr. Doom. Nouriel Roubini, who foresaw the 2008 financial crisis, has a tough prescription for the euro – a 30% cut in value, to get it closer to parity with the US dollar.
Without this devaluation, Roubini sees the euro-zone as doomed. A drop in the value of the single currency will help the old continent regain its competitiveness and could restore stability.
Speaking in Davos, the NYU professor described France as the “soft core” and Germany as the “hard core” of the euro-zone.
Roubini isn’t that bullish on the US. While he did have some positive words about the Fed’s commitment for low rates, he did cast doubts about the next phase:
“Some interest rate clarity is useful but there is lots more uncertainty out there – how are they going to exit this liquidity expansion?” he said.
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