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The rivalry between the U.S. and China could be so disruptive that it’s starting to decouple the global economy and could eventually cause a recession, according to Nouriel Roubini, the economist famously called the housing bubble.
“The consequences of this trade and tech war and cold war [are] the beginning of de-globalizaion … and the decoupling of the global economy. We’ll have to redo the global tech supply chain. And eventually by next year, if this escalates, it will be a global recession,” said the head of Roubini Macro Associates in an interview with Bloomberg TV on Tuesday.
The U.S. and China have recently reached a truce in their yearlong trade war after the two countries slapped tariffs on billions of dollar worth of each other’s goods. Yet Roubini is pessimistic that the world’s two largest economies will work out a long-term agreement anytime soon.
“My base case is … the trade and tech war between the U.S. and China…