REUTERS/Gus Ruelas

Nouriel Roubini told Der Spiegel last week that he expected global stocks to drop by 30% to 40% this year.

The "Dr. Doom" economist also predicted that President Trump won't be reelected and warned that investors might be underestimating the potential fallout from the coronavirus.

"I live in New York City, and people there are hardly going to restaurants, cinemas, or theaters," Roubini said on Thursday, before the city confirmed its first case on Sunday. He added, "If it comes, we are totally f---ed."

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Nouriel Roubini, the economist nicknamed "Dr. Doom" for his pessimistic predictions, told Der Spiegel on Thursday that he expected stocks to plummet this year, President Donald Trump to lose the election, and the novel coronavirus to have a bigger effect on the global economy than many investors anticipate.

Stocks will fall

"I expect global equities to tank by 30% to 40% this year," Roubini, a professor at New York University's Stern School of Business, told the German newspaper.

The S&P 500 last week posted its worst weekly performance since the 2008 financial crisis as investors braced for the coronavirus to disrupt supply chains, weaken customer demand, and slow economic growth.

Roubini advised investors to hold cash and government bonds. "You have to hedge your money against a crash," he said, adding, "That's my motto: "Better safe than sorry!"

Trump will lose

Roubini said that as the US and Iran each push for regime change, escalating tensions would "drive up oil prices and lead inevitably to Trump's defeat in the elections."

The economist pointed to the 1973 oil shock, the oil crisis in 1979, and the Kuwait invasion as examples of oil-price spikes scuppering past presidents' reelection campaigns.

"The Democratic field is poor, but Trump is dead," Roubini added.

Coronavirus will pose a major threat

"The markets are completely delusional," Roubini told Der Spiegel. He said that if the coronavirus were to cause China's economy to shrink by 2% in the first quarter and grow by only 6% in each of the next three quarters, the slowdown "would essentially mean a recession for China and a shock to the world."

A coronavirus outbreak in the US would escalate the situation, Roubini said.

"I live in New York City, and people there are hardly going to restaurants, cinemas, or theaters," he said, speaking before the city confirmed its first case on Sunday. He added, "If it comes, we are totally f---ed."

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