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“ ‘The European system of greater social cohesion gives you better economic outcomes than the one of the United States that is just Wild West capitalism. That’s why the unemployment rate barely went up in Germany or even in Italy, while in the U.S. we’ve had double-digit unemployment rate and actually even worse, considering underemployment and so on.’ ”
That’s NYU economics professor Nouriel “Dr. Doom” Roubini explaining to Bloomberg Television in a recent interview why he believes the battered U.S. economy will have a particularly tough time delivering the swift rebound some have been predicting amid the coronavirus pandemic.
In fact, Roubini, who was once named one of the “top 100 global thinkers” after he nailed the housing crisis more than a decade ago, said that the V-shaped bounce “is becoming a U, and the U could become a W if we don’t find a vaccine and don’t have enough stimulus.”
Last week, initial weekly jobless benefit claims rose above 1 million again, worse than expected and potentially pointing to an increase in layoffs after a summer coronavirus surge.
Bottom line, “Main Street is struggling,” Roubini said, and those struggles obviously aren’t being reflected in the stock market, where the major indexes are bouncing around record highs.
Here’s a clip from the interview:
At last check, stocks were building on recent gains, with the Dow Jones Industrial Average DJIA, +0.96% up almost 300 points to start the week. The S&P 500 SPX, +0.74% and Nasdaq Composite COMP, +0.54% were both firmly in the green, as well.
