Nouriel Roubini says the coming global recession will drive down energy prices 30%. That's good news, in a way. Lower energy prices will help calm spiraling inflation. But of course, amid the global recession, it will be hard to see that silver lining.

Before we get to the energy price decline, here's a reminder of why Nouriel thinks we're headed for the worst global recession since the Depression:

the collapse of housing bubbles in the US, the United Kingdom, Spain, Ireland and other euro-zone members

punctured credit bubbles

severe credit and liquidity crunch following the US mortgage crisis

negative wealth and investment effects of falling stock and housing markets (already down by more than 20% globally)

the global impact of the recession in the US (which still counts for about 30% of global GDP) and the weak dollar

high oil and commodity prices

Nouriel thinks these factors will drive the G7 (Canada, France, Germany, Italy, Japan, United Kingdom, and United States of America) into a deep recession. This global slowdown will reduce demand for energy and commodities, and, as a result, their prices will drop by as much as 30%.

But before you celebrate declining prices, note the cause and effect here: Global recessions aren't good news.

So what does all this mean for inflation? Will our current stagflation continue, taking us right back to the 70s? Nouriel's actually suprisingly optimistic here--with respect to the US. He's still gloomy as hell about the rest of the world:

Falling oil and commodity prices – already down 15% from their peaks – will somewhat reduce stagflationary forces in the global economy, yet inflation is becoming more entrenched via a vicious circle of rising prices, wages, and costs. This will constrain the ability of central banks to respond to the downside risks to growth.

In advanced economies, however, inflation will become less of a problem for central banks by the end of this year, as slack in product markets reduces firms’ pricing power and higher unemployment constrains wage growth.

If inflation drops, more central banks will eventually be able to cut interest rates to spur economic activity. Unfortunately, especially outside the US, Roubini believes the recession will hit too hard for the central banks to see the correct course of action in time:

...the policy response will be too little, and will come too late, to prevent it.

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