What does Dr. Doom think of emerging markets?

Dr. Nouriel Roubini is so famous for his gloomy forecasts that he’s often called “Dr. Doom” — so why is he so bullish about emerging markets? 

Image courtesy Kjetil Ree: http://commons.wikimedia.org/wiki/User:Kjetil_r

Nouriel Roubini: Turkish economist and professor of economics at the Stern School of Business, New York University.

In a recent interview in USA Today, Roubini called emerging markets a “long-term story.” 

“Their growth rate in the long run is 6%,” he said, “while in advanced economies (including the U.S.) it’s 2%, 2.5%. So if you are willing to invest for the long run, yes on emerging markets.”

While Roubini is long term bullish on emerging markets, he is short term bearish on many countries – and the entire continent of Europe.

“Europe is in a recession in the periphery countries,” Roubini said, “and it’s getting worse. There is a double-dip recession in the United Kingdom, sluggish growth in Japan, and the data from many emerging markets are also suggesting a slowdown in China, Russia, Brazil, India and places like Turkey, Mexico and South Africa.”

Roubini: ‘perfect storm’ coming for global economy in 2013

Roubini is more bullish on the United States (DIA, quote) and the emerging market (EMB, quote) outlook than the April update of the IMF World Economic Outlook.

The IMF projects 3.5% global economic growth for 2012, with only 2.1% growth in the United States. The Euro area is expected to contract by -0.3%, although France and Germany will grow slightly. Emerging and developing economies (DEM, quote) will see 5.7% economic growth for 2012, down from 6.2% in 2011 and 7.5% in 2010. 

The IMF expects China (FXI, quote) to expand the most in 2012 at 8.2%, with India (EPI, quote) next at 6.9%. From this, the region of developing Asia will lead the world with a 7.3% growth rate for 2012.

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