The global economy faces the risk of a double-dip recession, according to economic soothsayer Nouriel Roubini.
That’s because the deleveraging process necessitated by the financial crisis will curb economic activity by governments, banks, and individuals, the New York University professor told CNBC.
But central banks and governments have to be careful not to add more stimuli to counter this situation, lest they join Greece in amassing unmanageable budget deficits.
In any case, investors will see that budget deficits have to be monetized, crowding out investment in the private sector, Roubini says. (more)