In an op-ed for Forbes magazine, Dr. Doom Nouriel Roubini isn’t quite done yet with the gloominess. While he did see some light at the end of the tunnel, it is still an end too far from where we are at the moment:
- Advanced economies are expected to contract 4% in 2009. Japan and the eurozone will suffer the sharpest downturns.
- BRIC economies will grow at half their 2008 pace.
- Deteriorated terms of trade, slower capital flows and tighter credit will push Latin America into recession from the 4.1% growth of 2008.
- The reduction in oil revenues and financial stress will contribute to a 5% year-over-year contraction in Russia, and some countries–especially in the Baltics–are at risk of double-digit contractions.
- Export-dependent Asia’s growth will slow significantly to less than 3% in 2009. China will have a hard landing with GDP growth falling to 5.5% while India will slow sharply to 4.3%.
- The Middle East and Africa will mark much slower growth, at half of their 2008 pace.
- The unemployment rate in developed countries will reach double-digits by 2010 (as early as mid-2009 in the U.S.) and push more people in developing countries into poverty.
- I expect the West Texas Intermediate (WTI) oil price to average about $40 a barrel in 2009.