Roubini's Latest 'Dr. Doom' Prediction: More Than 400 Banks Will Fail
Speaking to CNBC, the renowned economist said the U.S. economy will remain weak in second half of the year, with growth below par at best. He reiterated what he has previously said -- that tailwinds will become headwinds. "We have to expect the new normal," he told CNBC. "We do not need a double dip for it to feel like recession."
The deleveraging of governments and consumers in the developed world has to continue, Roubini said, and while the biggest banks have been supported, "800-plus small- and medium-sized banks in the U.S. remain on the critical list and half of those will go bust."
The economist repeated his previous statements that policymakers are out of moves to stimulate the economy, and that the U.S. is facing a liquidity trap and has insolvency problems. But, for a change, he suggested a plan: "What we need [are] credible spending plans over the medium term on health care, welfare and retirement age. This will create a fiscal constraint lasting well into next year."