"Dr. Doom" Roubini: Worst Likely Behind Us, Might Need a Second Stimulus (unemployment, speech)

[delusianne]

“We might be at the bottom or close to the bottom,” Roubini said in a speech today at a Chilean investors’ conference in New York. “In many ways the worst is behind us in terms of economic and financial conditions,” he said, cautioning that “the recession might continue through the end of the year.”

“We should continue with fiscal stimulus and we might need a second one,” Roubini, 51, said today. There’s still a “meaningful amount of weakness” in labor markets, industrial production and housing, he said.

A second stimulus package of as much as $250 billion may be needed sometime early next year, particularly if unemployment goes “well above 10 percent by the end of the year,” he said.

U.S. Recession May End This Year, Roubini Predicts (Update3) - Bloomberg.com

[delusianne]

NEW YORK (Reuters) -- The United States may need a second fiscal stimulus worth $200 billion to $250 billion to support labor markets, leading economist Nouriel Roubini said Thursday, adding the worst of the crisis is already behind us.
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"It might be in the $200-$250 billion range -- not too small, not too big," he added.

But if the next stimulus is too large, Roubini warned, financial markets would start to get worried about U.S. fiscal sustainability, with "severe" negative consequences for bond markets.

Roubini conceded, however, that "the worst is behind us in terms of economic and fiscal conditions," as the economy is still contracting but at a slower pace.

"There is light at the end of the tunnel. And for once it is not an incoming train," he earlier told investors during a presentation.

U.S. may need another fiscal stimulus Roubini - Jul. 16, 2009