「Doomsday Doctor」 Uncommonly Optimistic: U.S. Stock Market Will Not Collapse, Technology Will Enable America to "Reverse Fate"

November 27th: For almost two decades, the renowned economist Nouriel Roubini has been renowned as the "Dr. Doom." This economist holds the view that following a brief growth slowdown, the United States will witness a strong rebound driven by technology and capital expenditure, enabling it to maintain its global leadership status. He pointed out that firstly, market discipline, rational advisors, and the Federal Reserve's independence have provided protection against the worst policies after the "liberation day." Due to a subsequent rapid and significant market correction, Trump had to make concessions and instead negotiate a more reasonable trade agreement. The currently prevalent view that the U.S. stock market is in a huge bubble destined to burst is incorrect in the medium term. Roubini noted that accelerated GDP growth may lead to rising real bond yields. However, a massive positive total supply shock driven by technology may over time push inflation down to near-zero levels as the production cost of goods and services declines sharply and productivity growth rises. Therefore, the long-term net impact on nominal bond yields may offset each other. He believes that even the U.S.' external debt is sustainable because a surge in technology-driven capital expenditure resulting in a larger current account deficit will be offset by capital inflows into U.S. dollar-denominated assets. At that time, the U.S. will resemble an emerging market economy where a natural resource or productivity boom has brought an investment surge. (Jin Shi)